Ansoffs Matrix is a marketing tool It allows

Ansoff’s Matrix is a marketing tool. It allows businesses to weigh up the level of risk involved in different marketing strategies. The matrix considers the growth of a business: �through new or existing products �in new or existing markets.

Ansoff’s Matrix

Market penetration involves selling more of the same products in the same markets. This strategy is low risk. Examples of how this may be achieved include: �Brand repositioning �Promotion �Loyalty schemes �Dropping prices

Market development is concerned with selling existing products in new markets. This strategy carries medium risk as firms may not have much knowledge of the markets they wish to break into. Possible methods of market development include: �Exploring foreign markets �Using e-commerce

Product development is about selling new products to existing markets. This strategy may take advantage of spare production capacity and technological advancements. It carries a medium risk. Products developed may be: �Completely new lines �Products related to existing lines �Modifications of existing products.

Diversification involves selling new products in new markets. This is the most risky of Ansoff’s four strategies. Diversification might occur through: �Integration with other businesses �New product development �Targeting markets that are already successful.