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Who is Ansoff and what is the matrix?
The Ansoff Matrix was originally developed by Harry Igor Ansoff who was a Russian American. An applied mathematician and business manager, Harry was broadly acknowledged as the father of strategic management. First published in the Harvard Business Review in 1957, titled "Strategies for Diversification." It has given generations of marketers and business leaders a quick and simple way to think about the risks associated with growth. The matrix is a tool which supports businesses to identify possible growth strategies within their organisations.
How does it work?
The matrix can also be known as the Corporate Ansoff Matrix and the Product/Market Expansion Grid. The grid or matrix is broken down into four quadrants, each providing a strategy for you to use, make strategic decisions or develop a new product or service. As you can see below, the quadrants provide the analyses of the risks associated with Market Development, Market Penetration, Diversification and Product Development. Furthermore, the risk will change along with the reward when you move into a new quadrant (horizontally or vertically) providing you with insight that will support decision making.
Market Penetration
The first quadrant in the Ansoff Matrix is marketing penetration. Often the strategy that is adopted when an organization has an existing product with a known market and needs growth within that market.
Market Development
The second quadrant is the strategy that is used when a business targets a new market with existing products.
Product Development
The third quadrant refers to a business which already has a good market share in an existing market and therefore might need to introduce a new product for expansion. Often needed when a business has a good client base and understands their market.
Diversification
The fourth quadrant applies when the product is completely new and is being introduced into a new market.
Our approach to building value within your business is captured in our service process; we want to see you grow and develop; therefore, we are here to assist you in implementing the use of the matrix in support of your endeavours. If you want to learn more about how the matrix works, don't hesitate to contact one of our professionals.
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Find more information on how to use the matrix:
https://www.mindtools.com/pages/article/newTMC_90.htm
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Disclaimer
The information provided in this article does not constitute advice. The information is of a general nature only and does not take into account your individual financial situation. It should not be used, relied upon, or treated as a substitute for specific professional advice. We recommend that you contact Brentnalls SA before making any decision to discuss your particular requirements or circumstances.
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