What is Ansoff Growth Matrix? A strategist named

What is Ansoff Growth Matrix?

A strategist named Igor Ansoff
developed a matrix called “Ansoff Matrix”, named after him. It was first
published in Harvard Business Review in 1957, in an article named “Strategies
for Diversification”. It has been a great advantage for business leaders and a simple
way to get to know about the risks of growth.

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It is also recognized as the Market
Development Grid, this Matrix shows four policies that can be uses for
analyzing the risks in the growth of your organization. Apple could make use of
these four groups in order to manage its existing products and development.

 

The 4-growth matrix of Ansoff is:

·     
Market penetration policy.

·     
Product development policy.

·     
Market development policy. And;

·     
Diversification.

 

Market penetration

Market penetration refers to the growth
strategy where the business focuses on selling existing products into existing
markets. Below are few of the main objectives Market penetration
focuses on. The firm seeks to achieve growth with existing products in
their current market segments, aiming to Increase its market share (Esther,
2018).

 

·     
By increasing the market share of the existing
products.

·     
By reforming the market, which will push away
competitors.

·     
By escalating the usage of existing customers.

Apple releases new and updated
version of iPhone every 12 months by adding variety of new features to its product
giving its consumers what they need. Samsung being the biggest competitor, it
becomes difficult for Apple to win over. So the best that Apple Inc.

could do is promoting its products massively and convincing for the customers to buy
the product making the competitors products unattractive.

 

Market development

Market development refers to the growth
strategy where the business seeks to sell its existing products into new and innovative
markets. Market development is more risky than market penetration because of walking
into new markets. The firm seeks growth by targeting its existing products to
new market segments (Esther, 2018). Below are few methods to approach this
strategy.

 

·     
Creating new markets.

·     
Creating new distribution methods.

·     
Creating different pricing plans may attract new
customers.

Apple’s first released in the
United States, was a great success. They continued developing and adding new
features to their products while their reputation kept increasing day by day,
opened as many Apple stores worldwide. Exhibiting these products reaching the
other side of the globe, which indicates a market development and expansion.

 

Product development.

Product development refers to the
growth strategy where a business aims to introduce new products into existing
markets. In order for the organization to avoid competitive products from
competitors organization needs to differentiate by introducing new features and
new products to the market frequently. The firm develops new products targeted
to its existing market segments (Esther, 2018).

Below are few product development
strategies.

 

·     
By researching & developing and being
innovative.

·     
By studying the customer needs and interests.

·     
And being the first to introduce to the market.

Apple is already a globally recognized
product in major markets, understanding its customer needs any wants they are
always close ahead from its competitors. Producing the first and best in the
market there is an increase in customer relationships in multiple stages,
creating brand loyalty. This increases the probability of the new products being
a hit.

 

Diversification.

Diversification refers to the
growth strategy where a business markets new products into new markets. This
policy has higher chances to be a risky strategy since the business is walking
into markets with minus experience. For businesses to implement a
diversification strategy, they must first have a clear idea about what it is
expecting to gain and to loose from this strategy. The firm grows by
diversifying into new businesses by developing new products for new markets (Esther,
2018).

 

Apple
initially started a computers manufacturer, well known as the Macintosh
computers. Later Apple Inc. shifted its goal towards a digital hub strategy by
launching of IPod’s, followed by IPhone’s and finally IPad’s. Changing its industry from computers was really risky. These
were risks taken by apple in the market, which showed success in the end. Shifting
its industries Apple differentiated it self from various competitors and gave
the company a competitive advantage over the other companies.

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