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BCG MATRIX

BCG Matrix is established in 1970 by Bruce Doolin Henderson

DEFINITION

  • Enhances the Multi divisional firms efforts to formulate strategies.
  • BCG Matrix helps business to analyze growth opportunities by reviewing the market growth and market share of products and further help in deciding where to invest, to discontinue or develop products.

BCG MATRIX

BCG MATRIX OF APPLE

BCG MATRIX

DOG

Apple I Pod

Dog

  • Low Growth
  • Low Market Share

Question Mark ?

Apple MAC Book

Question Mark

  • High Growth
  • Low Market Share

STAR

Stars

  • High Growth
  • High Market Share

Apple I Phone

CASH COW

Cash Cow

  • Low Growth
  • High Market Share

Apple IPAD

STAR

STAR

Stars are the Leaders in business

They require heavy investment to maintain its large market

FEATURES OF STAR

It leads to large amount of cash consumption and cash generation

Attempts should be made to hold the market share otherwise the star will become a cash cow

QUESTION MARK

QUESTION MARK

Most Businesses start of as question marks.

They will absorb great amounts of cash if the market share remains unchanged

FEATURES OF

QUESTION MARK

Question Marks have potential to become star .

Investment should be high for Question Marks

CASH COW

CASH COW

They are foundation of the company and often the stars of yesterday

They generate more cash than required

FEATURES OF S

CASH COW

They extract the profits by investing as little cash as possible

They are located in an industry that is mature , not growing or declining

DOG

Dogs are cash traps

Dogs do not have much potential to bring in much cash

FEATURES OF

DOG

Business is situated in declining stage

Conclusion

  • Star Strategy : Invest Profit for future growth and for earning more of market share and profit.
  • Cash Cow Strategy : Use profit for finance new products and growth else where
  • Question Mark Strategy : Either invest heavily in order to push the products to star status or divest in order to avoid it becoming a dog.
  • Dog Strategy : Either to invest to earn market share or consider divesting

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