The BCG matrix is a model used to analyze a business's products and aid long-term strategic planning. It considers two aspects of a product: market share and market growth potential. Products are placed into one of four quadrants - stars, question marks, cash cows, and dogs - based on their market share and growth. This helps companies identify growth opportunities and determine where to invest resources for the future.

1. BCG Matrix
Also known as
Growth Share Matrix

2. • A BCG matrix is a model used to analyze a
business’s products to aid with long-term
strategic planning. The matrix helps
companies identify new growth opportunities
and decide how they should invest for the
future.
• It is created by the Boston consulting group,
the BCG matrix also known as the Boston
Matrix or Growth Share Matrix provides a
strategy for analyzing products according to
growth and relative market share.
DEFINITION

3. The BCG matrix considers
two different aspects of
a business unit or product:
1.What is the current market
share?
2.What is the market’s
growth potential?
The BCG matrix (sometimes
called the Growth-Share
matrix) was created in 1970 by
Bruce Henderson and the
Boston Consulting Group to
help companies with many
businesses or products
determine their investment
priorities.

4. Market Share
It is the percentage of a market (defined in terms of
units sold or revenue) accounted for by a specific
product or entity.
Relative Market Share

5. Market Share
Market Share by Volume or Unit Market Share
Unit
Market
Share
=
Total
Units
Sold
÷
Units in
whole
Market
X 100

6. Market Share
Market Share by Value or Revenue
Revenue
Market
Share
=
Company’s
Total
Sales
÷
Total
Market
Value
X 100

7. Market Growth
An increase in the number of people who buy a particular
product or service, or the number of products, etc.
MARKET GROWTH FORMULA
OR
= St-St-1
St-1

8. BCG Matrix Advantages and
Disadvantages

9. BCG Matrix Advantages and Disadvantages
Advantage Disadvantage
• Easy to Understand •Ignores other Factors of
Business
• Identification of
Opportunities
• Simplistic Approach for a
Complex situation
• Helpful in Removing the
Weak area of Business
• No Middle Path

10. How do you Create BCG
Matrix?

11. BCG Matrix Template

12. Stars quadrant
The business units or products with the
best market share and generating the
most cash are considered Stars.
Monopolies and first-to-market
products are frequently termed Stars
too. Basically those are products that
are in high growth markets and that
make up a sizable portion of that
market.
Question mark quadrant
These parts of a business have
high growth prospects but a
low market share.
In other words, questionable
opportunities are those in high
growth markets but in which
the company does not maintain
a large marker share.
Market
Share
Market Growth

13. Cash cow quadrant
Cash Cows are business units or
products with a high market share but
low growth prospects, and the
company thus milk cash cow for as
long as it can.
A Cash Cow is a market leader that
generates more cash than it
consumes. Cash Cows are business
units or products with a high market
share but low growth prospects.
Dog quadrant
Dogs, sometimes also referred
to as Pets, are units or products
with a low market share and low
growth rates. Dogs are generally
considered cash traps because
businesses have money tied up
in them, even though they bring
back almost nothing in return.
These business units are prime
candidates for divestiture.
Market
Share
Market Growth

15. Thank
You!