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» Economics » Marketing » Topics begins with P » Product market matrix

Page modified: Tuesday, July 12, 2011 15:28:27

The product market matrix (also Ansoff matrix, after its inventor Harry Igor Ansoff) is a tool for the strategic management of enterprises. It can the management, which decided for a growth strategy, when aids to the planning of this growth serve.

The product market matrix regards the Potenziale and risks of four possible product market combinations:

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| |! bgcolor= " #dddddd " | existing products! bgcolor= " #dddddd " | new products | -! bgcolor= " #dddddd " | existence markets! bgcolor= " #eeeeee " | market penetration! bgcolor= " #eeeeee " | product development | -! bgcolor= " #dddddd " | new markets! bgcolor= " #eeeeee " | market exploitation! bgcolor= " #eeeeee " | diversification |} 
  • Market penetration: The enterprise tries to grow in an existing market by increasing the market share of products already existing. That is done in principle via the increase of the paragraph at existing customer, the sales of the products to new customers, the production of customer, those before with the competition bought or a combination of these possibilities. This strategy saves a small risk, since it can avail itself of existing resources and abilities. However growth is usually limited: If the market is satisfied, must be changed on another growth strategy.
  • Market exploitation: The enterprise tries to increase the target group for products already existing by development of new market segments or new geographical regions. This strategy is recommendable for enterprises, which aligned its authority and philosophy rather to a specific product as on a specific market. By the expansion into a new, unknown market the risk of this strategy is however higher than a bare market penetration.
  • Product development: With this strategy enterprises try to satisfy the needs of their existing market with new products. This proceeding can be favourable for enterprises, whose strength refers rather to a specific clientele as on specific products. By the necessity to have to acquire itself new abilities and however also product development clearly higher risks than the market penetration saves the imponderability of the success of the new development.
  • Diversification: The diversification is the riskiest of the four regarded growth strategies. It requires not only the development of a new product, but at the same time the development of new markets. She can be justified in individual cases however by the chance of a high Return on Investment. Further advantages can be in the entrance into a potenziell attractive industry or in the reduction of the general business Portfolio risk.
    • The diversification can be divided again into horizontal, vertical and lateral diversification.
    • The horizontal diversification is the extension of the production program. (Bsp: A brewery produces now also alcohol-free products).
    • The vertical diversification is the sales stage stored by products pre or. (Bsp: Automaker sells also tires).
    • The lateral diversification is the sales of completely new products, which within the range of the technology and marketing in no connection. (Bsp: Automaker produces a coffee machine).


  • Hermann Simon, Andreas of the Gathen: The large manual of the strategy instruments. All tools for a successful management. Campus publishing house, 2002, ISBN 3593369931

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