Discribing of growth strategies

1. Strategic Marketing
Basic Growth Strategies

2. Company’s growth directions
 Intensive growth
By means of working with clients, products and
markets
 Integrated growth
By means of merging with other companies
 Diversified growth
By means of the company’s businesses
diversification

3. Intensive growth
 Without changing the product, at the same
market
 With changing the product, at the same
market
 Without changing the product, at the other
market
Example
 Goal №1: Market share growth
 Goal №2: Clients’ satisfaction improvement

4. I. Ansoff’s matrix «product-market»
DiversificationProduct
development
New
Market
development
Market
penetration
Current
NewCurrent
MarketsGoods

5. Modified matrix «product-market»
Vertical
integration,
diversification
Innovation
(new
brands)
Product
modification
Product
improvement
New products
Market
development
Reposition
ing
Segment
expansion
Segment
penetration
Current
products
New
markets
New
segments
New areas in
“old
segments”
Current
segments
Strategic
direction

6. Market penetration
Objectives:
 Primary demand development
 Gaining repeated purchases (frequency,
intensity)
 New segments development
 Taking clients away from competitors
 Saving clients
 Company’s image improvement
 Concentrating on the best segments

8. Product development
Objectives:
 to develop the demand on product substitutes
 to attract new segments
 to take clients away from competitors
 to save your own clients
 to improve the company’s image
 to concentrate on the best products

9. Methods
 adding features (improvement, innovation)
 product range updating (improvement)
 product range expansion (modification,
innovation)
 product quality improvement (innovation)
 product range reduction
 product group purchasing

10. Improvement
 The new-generation game consoles of Sony and Microsoft were
launched last year with a difference in one week. In January the
timely supply resumption in the US allowed Sony to win twice as
much as its main competitor - Xbox One.
A special attention in PlayStation 4 is placed
on its social functions.
Gamers will be able to share gameplay
videos. To access the new features the
console interface has been completely
redesigned.

11. Audi launches a new gas-powered A3
Sportback.
Europe Audi dealers has already been
taking orders for the gas-modified Audi A3
Sportback g-tron.
In Germany it will cost around €27
thousand.
Modification

12. Innovation
Mariott International launched at the Berlin International Hotel Investment
Forum its new brand – Moxy Hotels – that will function in a three-star
hospitality segment in Europe.
This brand has been designed for the young generation, it combines
stylish design, friendly service and reasonable prices.

13. LG provided an overview of different products to look forward to
in 2015, including everything from some beautiful new OLED
TVs to a crazy new washing machine that basically has
another washing machine inside of it.
LG wants to create an entire ecosystem of products that work
together, including home automation, smart cars, and a new
wellness platform.
LG spent a good deal of time talking up its new OLED TV line,
along with hopes of making it the new standard in home
television.
The company introduced seven new OLED screens - including
curved, flexible, and flat models.
LG Electronics will also display the smartphone line-up,
including G3 family products and AKA, as well as wearable
devices such as the G Watch R and KizOn.
CES 2015, the world’s largest consumer
electronics trade show news

14. The Many Faces of Oreo
1912
A bakery in Chelsea Market made the first one.
Then, six decades later, somebody had an idea.
1974
Double Stuf
1991
Halloween Edition
1995
Winter Oreo
2001
Chocolate Creme
2004
Golden Oreo
2004
Football Oreo
2012
Birthday Cake
2014
Cookie Dough
2015
Red Velvet

15. Market development
 Regional
 Transnational
 Global
Objectives
 Sales volume growth
 Mature markets risks’ reduction
 Company’s image strengthening

16. Methods
 Direct selling / export
 Indirect selling / export
 Branch launching
 Franchising

17. HTC expansion
Taipei, Jan. 21 (CNA) Taiwanese smartphone maker HTC Corp. (宏達電) et
a target Wednesday for its home market this year that aims to expand
the company's distribution network and improve its brand image among
consumers.
HTC is betting on expansion plans of its Taiwanese distribution partners
to increase the number of stores in 2015, which is expected to boost
HTC's brand image and promote the firm's products to more local
consumers, Tong said. "Our new vision for brand is to expand HTC's
reach to everywhere”.
HTC has teamed up with 19 local distributors who run a total of 72 direct
stores selling only HTC products. Tong forecast that the number of HTC
direct stores in Taiwan will reach 100 in 2015, with sales from the
stores expected to double from last year (retail stores will account for up
to 40 percent of Taiwan's overall smartphone sales this year from 20
percent last year).

18. Diversification directions
 new business area entry (related)
 related business areas diversification (adjacent)
 unrelated business areas diversification (unrelated)
 business purchasing and liquidation
 recovery and economical behaviour, portfolio
restructuring

21. Integrated growth: forms and advantages
 Horizontal integration
 Vertical integration

22. On January 1, 2014 the agreement on Fiat acquiring Chrysler was
announced. Its new name is Fiat Chrysler Automobiles NV (FCA).
After the merger is accomplished, the company will be incorporated
in the Netherlands with a fiscal office in the UK.
Fiat had already owned 59% Chrysler shares before the deal.
The joint company will become the world seventh biggest car
manufacturer.

23. Facebook has acquired WhatsApp for
$21,8 bln.
Earlier in 2012 it acquired Instagram for
$1 bln.

25. Mergers & Acquisitions

26. Counter-integration
 eBay Inc. to Separate eBay and PayPal into Independent Publicly
Traded Companies
"Our board and management team believe that putting eBay and PayPal
on independent paths in 2015 is best for each business and will create
additional value for our shareholders”, - said eBay Inc. President and
CEO J. Donahoe.
 Hewlett-Packard Co. plans to separate its personal-computer and
printer businesses from its corporate hardware and services operations,
the latest attempt taken by the technology company to improve its
fortunes by breaking itself into two.

28. Market position holding or reduction
strategies
 Position holding or leaving strategies:
 Harvesting by means of:
 business selling, often to competitors
 association with competitors but preserving independence
 refusal from direction development, e.g. production
implementation with product marketing termination
 Reduction strategies:
 Market reduction
 Product line reduction
 Divestment

29. The South Korean group Samsung
has temporarily stopped the work of
about 20 percent of outlets in
Russia. Most of them were
operated by the retailer “The White
Wind", which is in the process of
bankruptcy.
However, the other partners of
Korean company also closed this
year mono-brand Samsung salons.
For example , Inventive Group
retailer Tikhon Smykov has already
closed up to 10 Samsung salons.

30. Matrix «product-market» and assessment of
company’s growth directions
 The most commonly used criteria for
assessing strategies options:
 Acceptability
 Market practicability
 Commercial viability

31. Balanced assessment of strategic
alternatives
Essential investment volume
Compliance with product /
business portfolio
Risk degree
Compliance with the
objectives
Acceptability
Dcbadcba
Strategy
balanced
assessment
Growth
options rating
on these
criteria
Criterion
weight
Strategy assessment
criterion

32. How to use I.Ansoff’s matrix?
Existing markets
Producedgoods
Market
1
Market
2
Market
3
Market
4
Market
5
Market
6
Product
1
Product
2
Write in the cells the current
revenue level and the revenue
level that is to be achieved in
the planned period
Product
3
Product
4
Product
5