File - the Arden Business Department

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3.1 - MARKETING
Lesson 8 – Product Portfolio Analysis
Starter Activity
Complete the gap-fill exercise on the lesson worksheet.
Learning Outcomes
All
Most
• Understand what • Understand the
is meant by
features of each
‘product portfolio’
category of the
Boston Matrix
• Recognise the
Some
• Categorise a reallife business’s
products using the
Boston Matrix
four categories of • Understand how
• Explain how the
the Boston Matrix
to categorise
Boston Matrix
marketing model
products using the links in with the
Boston Matrix
Product Life Cycle
The Boston Matrix
• There are many ways of doing product portfolio
analysis
• However, one way is to use a technique called the
Boston Matrix
• The Boston Matrix is a marketing tool that was
developed by the Boston Consultancy Group (BCG) as
a method of analysing and planning a business’s
portfolio of products
The Boston Matrix
• The Boston Matrix allows businesses to measure the
extent to which an individual product is succeeding
in its market
• Using the Matrix, every product in the portfolio is
categorised according to the level of growth in the
product’s market and its relative share of that market
Market Growth
• How fast is the whole market for the type of product
growing? For example, the market for tablet pc’s is
growing rapidly, whereas the market for video
recorders is shrinking
• High market growth is where the % increase in sales
year on year is high and possibly rising
• Low market growth means that sales are rising by a
relatively small % or possibly falling
Market Share
• How strong is the individual product within its
market? This is measured as number or value of sales
• What market share does it have?
• For example, the Apple iPod has a high market share
of the mp3 player market whereas the Microsoft
Zune has a low market share
The Boston Matrix
• Using the factors of market growth and market share,
each product in a business’s portfolio can be
categorised as one of the following:
STAR
PROBLEM
CHILD
CASH
COW
DOG
The Boston Matrix
MARKET GROWTH RATE
HIGH
STAR
PROBLEM CHILD
CASH COW
DOG
LOW
HIGH
RELATIVE MARKET SHARE
LOW
The Boston Matrix
are products with a high market share in a high
growth market
are products with a low market share in a high
growth market
are products with a high market share in a low
growth market
are products with a low market share in a low
growth market
Activity
Using pages 240-241 of the course textbook, see what you
can learn about the four categories of the Boston Matrix.
Take notes using the table on page 3 of the lesson
worksheet.
Activity
Working in groups, you are going to carry out a product portfolio
analysis using the Boston Matrix.
You can choose which company’s products you wish to analyse, but
here are some suggestions:
Kelloggs, Cadbury, Walkers, Coca-Cola
You are going to create a poster each showing the Boston Matrix and
where you think your chosen company’s products should be placed
on it. You may draw the products or just write the name if you prefer.
Be prepared to explain your choices!
Start this task by making a list of ten products that your chosen
company produces, then decide where these go in your matrix.
Think, Pair
Share
Take timed turns
listening, sharing
and responding
1. How does the Boston Matrix link in with the Product Life
Cycle? For example, whereabouts would you expect products
that are stars to be on the life cycle model?
2. Think time – 1 minute
3. Who goes first - wait for start
4. In pairs, Partner A shares, Partner B listens
5. Time up
6. Partner B responds by summing up what Partner A has said
7. Both partners record answers on the last page of the lesson
worksheet
8. Partners switch roles – wait for start
Learning Outcomes
All
Most
• Understand what • Understand the
is meant by
features of each
‘product portfolio’
category of the
Boston Matrix
• Recognise the
Some
• Categorise a reallife business’s
products using the
Boston Matrix
four categories of • Understand how
• Explain how the
the Boston Matrix
to categorise
Boston Matrix
marketing model
products using the links in with the
Boston Matrix
Product Life Cycle
Homework
Have an amazing weekend!!