This model is essential for strategic marketing planning where it can be applied to look at opportunities to grow revenue for a business through developing new products and services or "tapping into" new markets. So it's sometimes known as the ‘Product-Market Matrix’ instead of the ‘Ansoff Matrix’. This focus on growth means that it's one of the most widely used marketing models. It is used to evaluate opportunities for companies to increase their sales through showing alternative combinations for new markets (i.e. customer segments and geographical locations) against products and services offering four strategies as shown.
Strategic questions that can be answered using the matrix include:
You may be executing more than one of these strategies depending on the stage in your business,
My best practice tip is to use Ansoff at least once a year in strategic planning for your business to identify potential new markets, new products as well as product development opportunities.
To evaluate the suitability of these strategies, issues to consider for each of these:
The Ansoff matrix is useful for developing online strategies too, for example...
To find out more how to review these strategies, read our free Models Guide which explains how to use the strategies for some of the following objectives.
Fairly new business then perhaps it's wise to focus on no more than two strategies, which could be Market Penetration and over time move to Market Development.
Ansoff, H. I. (1957). Strategies for Diversification. Harvard Business Review. (Vol. 35 Issue 5, Sep/Oct). p113-124.
By Annmarie Hanlon
Annmarie Hanlon is the Smart Insights expert commentator on online and offline marketing strategies for business. Annmarie is the MD of Evonomie and author of Quick Win Marketing, and co-author of Quick Win Digital Marketing. She runs social media workshops in the UK and Ireland and shares marketing tips and news in her blog, B2B Marketing. You can follow Annmarie on Twitter or connect on LinkedIn.
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