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How the Ansoff Matrix Can Help You Plan Your Business
The Ansoff Matrix is a tool created by the Russian-American Igor Ansoff (mathematician and business manager) and is used by companies and organizations to plan their growth strategies.
It consists of four strategies, which help organisations to analyse the risk associated with the tactics they use.
Where is the Ansoff Matrix used?
Also known as the Ansoff Product/Market Growth Matrix, it is used to analyse and generate alternative directions to steer business development.
This tool is used before and during the marketing process. It helps to identify which strategies to apply in order to improve all negotiations. In addition, companies use the Ansoff Matrix when they also want to target a new market with their existing services or products.
There are several options available such as the development of new products in the market. It even predicts which products might be relevant and what risks need to be taken into account in order to implement good decisions.
In itself is a 100% complete tool that can help us in the development of our business.
But above all, to be more precise when it comes to being a key option for our clients.
The Ansoff Matrix works by identifying the current market problems.
Once you have identified the difficulties that customers have in your sector, this tool helps you to position your product.
You can also use these concerns to develop new products, which can then be marketed to your customers.
While working with the Ansoff Matrix try to focus on these four key concepts:
Market Penetration: What products are your current consumers buying? Is there a way to sell them something else? Focus on increasing sales of existing services or products to an existing market.
Market development: Are there new markets adjacent to yours, where there may be less competition and more opportunities? Focused on introducing new services and products to the existing market.
Product development: Are there areas where you could reduce costs, or different ways of developing your product to better serve your customer? Your strategy focuses on entering a new market.
Diversification: Could you develop a new product and move it into a new market, taking advantage of first-mover advantages? It focuses on entering the market with existing products.
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