1. BCG Matrix : Product Portfolio
Method
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2. Prof Sonali

3. BCG Matrix
 BCG matrix based on Product lifecycle Theory
 Determine what priorities should be given in the Product Portfolio of
a business unit
 The BCG Matrix allows a multidivisional organization to manage its
portfolio of businesses by examining the relative market share
position and the industry growth rate of each division relative to all
other divisions in the organization.
 To ensure long-term value creation a company should have a
portfolio of products that contain both high-growth products in need
of cash inputs and low growth products that generate a lot of cash
 It has two dimensions : MARKET SHARE AND MARKET GROWTH
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4.  A high growth product is for example a new one
that we are trying to get to some market.
 Effort and resources to market it ,bnuild
distribution channels ,build sales infrastructure
 Expected to bring gold in future
 iPod
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5.  A low growth product is for example an
established product known buy the market .
 Limited budget for marketing
 Milking cow that brings constant flow of cash
 Colgate toothpaste
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6. Stars
 High growth High market share
 Use large amounts of cash
 Leaders in business
 Generate large amounts of cash
 Likely to grow into cash cow
 Needs lot of promotion
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7. Cash Cows
 Low growth high market Share
 Profits and cash generation should be high
 Foundation of a company
 Mature market
 Investment low
 Are the products that business strive for
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8. Dogs
 Avoid and minimize number of dogs in a company
 Beware of expensive turn around plans
 Deliver cash ,otherwise liquidate
 Low growth market low market share
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9. Question Marks
 High growth low Market Share
 Worst Cash characteristics
 High demands low returns due to low market share
 Absorb great amounts of cash
 Either invest heavily or sell off or invest nothing and generate
whatever cash it can
 New products ,buyers are yet to discover them
 Needs to increase market share quickly or they become dogs
 Either invest heavily to gain market share or sell them
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10. Conventional strategy
 Build share
Invest to increase market share
 Hold
Invests just enough to keep the SBU in present position
 Harvest
Reduces amount of investment in order to maximize
short term cashflows and profits from the SBU
Effect of turning stars into cash cows
 Divest
Phase it out or sell
Use resources elsewhere
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11. Problem
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12. References:-
 Marketingteacher.com
 NetMba.com
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