Designing the business portfolio involves analysing the company s current portfolio by a portfolio analysis, which is addressed here, before strategies for growth and downsizing can be developed. The premise of the bcg matrix is that all products or brands can be classified as one of the following categories, based on its market share and market growth. Boston consulting group bcg matrix is a four celled matrix a 2 2 matrix developed by bcg, usa. The bcg matrix, also known as the boston growthshare matrix, is a tool to assess a companys current product portfolio. G matrix, method used in the strategic decisional processes to streamline.
Marketing managers attempt to make a product appeal to specific groups of people, called segments. An analysis of several pepsico brands using a boston. The cola beverage industry serves a good example here. Worlds leading readytodrink beverage company, coca cola company has. Boston matrix product portfolio model business tutor2u. Now, follow to the answer for analyze the business portfolio of a beverage company using bcg matrix below the current business portfolio of the company is. The boston consulting group bcg matrix is a portfolio management tool created in 1970 by bruce henderson. Only a diversified company with a balanced portfolio can use its strengths to truly capitalize on its growth opportunities. How to use the bcg matrix smart insights digital marketing. It is the most famous and simple portfolio planning matrix. Using the boston consulting group portfolio matrix to analyze.
The product portfolio matrix, also called growthshare and bcg matrix, wants to help you achieve the right blend of young and established products in order to maximise the overall value a portfolio creates. Sep 27, 2012 portfolio analysis allows a company to analyze and divide up their portfolio of products andor services in two dimensions, market share and market growth. The bcg matrix explained how does the bcg matrix work. Edraw is used as a bcg matrix software coming with readymade bcg matrix templates that make it easy for anyone to create beautiful bcg matrix. The entire project with the name red bull stratos was sponsored by the austrian beverage company red bull which has created the global market. It is argued that relative competitive position and growth are the two fundamental parameters which must be considered in. This chart was created with the purpose of helping companies analyze their different business units or product lines. Now, follow to the answer for analyze the business portfolio. Based on qualitative research, this paper aims at identifying the causes of rise and fall of the b. It presents wyb, a zerocalorie drink to compete with moodfreshs shire, a lowcalorie drink. Portfolio analysis importance of portfolio corporate. The matrix classifies a product line based on two major dimensions a products competitive position in the market relative market share and the growth rate of the industry.
The subject code is mb0030 which is related to marketing management assignment. Bcg matrix is the term used in the context of management. Worlds leading readytodrink beverage company, coca cola company has more than 500 soft drink brands, from fuse tea to oasis to lilt to poweradeorlds, but none of them is anywhere close to coke brand in awareness, revenue, and profit. This paper critically assesses the boston consulting group bcg matrix and indicates how the matrix can be improved to solve portfolio problems. Based on this assessment, the boston matrix helps in the longterm strategic planning of the companys portfolio, as it indicates where to invest, to discontinue or develop products. Present and future of nestle bangladesh limited citeseerx.
These are the products with low growth or market share. According to the bcg matrix, are companies that have a small share of a fast. Analysis of business portfolio of a beverage company using. To develop the efficiency of marketing decision making, the bcg matrix plays an effective tool for strategic planning of product performance in industry and company level. The boston growthshare matrix, developed by the boston consulting group, is a very helpful tool for the portfolio analysis. As explained by others, i think the bcg matrix is a way to think about existing products assets and think about their usage strategy going forward. Sep 15, 2014 this post will look at what nestles bcg matrix is likely to look like and critique how useful the matrix is. The boston consulting group bcg matrix, also known as growth share matrix, is a tool to manage a company s business portfolio and derive appropriate actions towards a higher total performance. In this article, we will look at 1 what is the bcg matrix, 2 understanding the bcg matrix, 3 how to apply bcg matrix to your company, and 4 some examples. Mar 24, 2015 the main objective of using bcg matrix is building an effective portfolio strategy.
Shareholders use this matrix as one of the tools for portfolio s analysis of the company to determine the financial stability and predict the future for the company. The content of this report will explain and analyse the application of bcg matrix with some examples. Henderson for the boston consulting group in 1970 to help corporations to analyze their business units, that is, their product lines. Expanding the bcg concept abstract the use of portfolio matrices has been of great popularity since their first outing in the 1960s. It is a portfolio matrix tool and is designed for larger companies to map, compare and analyze their existing business divisions strategic business units or sets of products. The divisions or products compromise the organisations business portfolio. Some of the other analytic tools will also be mentioned in this work. The boston consulting group matrix bcg matrix can be used to analyze the different products being sold by the company in terms of their market share, sales generated on an annual basis and the potential for growth. Question of assignment is analyze the business portfolio of a beverage company using bcg matrix. Business portfolio of a beverage company using bcg matrix. According to the beverage industry survey, the market share of the nonalcoholic beverage industry is highly concentrated. A business portfolio is a companys set of investments, holdings, products, businesses and brands.
Analysis of the portfolio of red bull based on the bcg matrix grin. Full form of bcg matrix is boston consulting group matrix. However, recent criticisms have been leveled at their inaccuracy and inability to include flexibility. Lets check out the bcg matrix of coca cola and what products of the company fall under what quadrant. Pdf business portfolio analysis and marketing strategy. Bcg classics revisited the growth share matrix by martin reeves, sandy moose, and thijs venema at a glance bruce henderson devised the concept of the growth share matrix in 1970 as a tool to help companies allocate resources on the basis of the attractiveness of their market and their own level of competitiveness.
Designing the business portfolio involves analysing the companys current portfolio by a portfolio analysis, which is addressed here, before strategies for growth and downsizing can be developed. Based on recent news sources and nestles 2012 annual report pdf, here is nestles current bcg matrix for a slection of their brands. Sep 02, 2018 lets check out the bcg matrix of coca cola and what products of the company fall under what quadrant. It is the most renowned corporate portfolio analysis tool. And every product should eventually be a cash generator. Free bcg matrix templates for word, powerpoint, pdf. Nov 30, 2019 originally conceived at the boston consulting group by bruce henderson, the growth share matrix, more popularly known as the bcg matrix, attempts to illustrate where a companys attention and capital should be focused in its portfolio of products and services.
Check out the bcg matrix of coca cola and what different products of the company fall. Pdf strategic management report for starbucks aishah. The cocacola company operated as an independent, local business until it merged. The bcg matrix was developed by the boston consulting group in 1968. Therefore, the boston consulting group designed product portfolio matrix bcg matrix or growthshare matrix to help business with longterm strategic planning. Every company needs products in which to invest cash.
Bcg matrix template variations presentation process. Dogs power drink market share is approximately 1 % 3. Bcg matrix is a useful strategic planning model developed by boston consulting group in 1970s. The portfolio approach is perhaps the most widely used method in strategic management and the growthshare portfolio analysis better known as the bcg matrix aka b. Sep, 2019 created by the boston consulting group, the bcg matrix also known as the boston or growth share matrix provides a framework for analyzing products according to growth and market share. In the bcg boston consulting group matrix, a business that has a low market share in an industry characterized by high market growth is termed a. Successful firms use a marketoriented strategic planning approach to. A business with a range of products has a portfolio of products. Analysis of business portfolio of a beverage company using bcg.
Pdf an analysis on bcg growth sharing matrix researchgate. It helps a company think about its products and services and make decisions about which it should keep, which it should let go and which it should invest in further. Oct 08, 2016 the boston consulting group matrix bcg matrix can be used to analyze the different products being sold by the company in terms of their market share, sales generated on an annual basis and the potential for growth. However, you can also use the model to determine the priority for other matters within a company. The composition of the portfolio can be critical tothe growth and success of the company. Bcg matrix is developed by bruce henderson of the boston consulting group in the year of 1968 bcg, 2012. High growth business competing in market where they are relatively strong compared with the competition. The growthshare matrix aka the product portfolio matrix, boston box, bcg matrix, boston matrix, boston consulting group analysis, portfolio diagram is a chart that was created by bruce d. Strengthening the portfolio analysis syed ferhat anwar1 sharif rayhan siddique2 shakil huda3 abstract. However, it can also be used to analyze a company with only one unit, or even to analyze individual product offerings.
In this article, we will look at what is the bcg matrix, understanding the matrix. To answer this question, the boston consulting group bcg matrix also known as the boston matrix is a very useful marketing tool in understanding portfolio management. Bcg matrix of pran bcg matrix or growthshare matrix is a corporate planning tool. Bcg matrix for cocacola company bcg matrix analysis. To young, active softdrink consumers who have little time for sleep. Stars question marks cash cows dogs it is based on the combination of market growth and market share relative to the. Bcg matrix of coca cola stp analysis of coca cola heart of codes. Analysis of business portfolio of a beverage company using bcg matrix mb0030 assignment this is marketing management mba assignment of smu.
For the credits bcg matrix was invented by the boston consulting group bcg in 1968. This helps the company allocate resources and is used as an analytical. Analysis of several pepsico brand using a boston consulting group matrix introduction the boston consulting group matrix, also known as the bcg matrix, divides brands and products into different categories based on their market performance. When using a bcg matrix, a business that currently holds a large market share in a rapidly growing market and that has minimal or negative cash flow would be known as a star. The bcg matrix, also known as the boston growthshare matrix, is a tool to assess a company s current product portfolio. Using the boston consulting group portfolio matrix to. This helps the company allocate resources and is used as an analytical tool in brand marketing, product management, strategic management, and portfolio analysis. A bcg matrix helps organizations determine which areas of their. Bcg matrix, business organizations, business improvement. Benefits of the bcg matrix the marketing study guide. Dogs power drink market share is approximately 1% 3.
If your market is extremely fragmented, however, you can use. For example, you can analyze your customer portfolio using the bcg matrix. A global multinational in the food and beverage industry, the swiss. Boston consulting group matrix bcg this technique is particularly useful for multidivisional or multiproduct companies. The bcg matrix for the red bull company own graphic. A few businesses generate far more cash than they can pro.
Because of its flexibility in this area, the bcg matrix is often called a portfolio analysis. Bcg matrix has four types of scenarios with respect to the market share of the company, cash flow generation and growth rate of the industry in which company is operating. The purpose of the matrix is to enable companies to ensure longterm revenues by balancing products requiring investment with products that should be managed for remaining profits. This is then used to determine which products receive investment, and which are diversified from.
A portfolio of products can be analysed using the boston group consulting matrix. A company s running portfolio of stars, cash cows, question marks, and dogs. The next part of the bcg matrix for coca cola deals with stars. Portfolio analysis explained the bcg matrix youtube. The bcg matrix also known as the boston consulting group analysis, the growthshare matrix, the boston box or product portfolio matrix is a tool used in corporate strategy to analyse business units or product lines based on two variables. According to the boston consulting group, a diversified company with a balanced portfolio is in the ideal position to use its strengths. It provides a graphic representation for an organization to examine different businesses in its portfolio on the basis of their related market share and industry growth rates.
Bcg matrix also known as the growthshare matrix is used by organizations to classify their business units or products into 4 different categories. Only companies with a balanced portfolio of productsas reflected in bcg s growthshare matrix can use their strengths to truly capitalize on growth opportunities. The bcg growthshare matrix positions different product lines based on market growth and market share in relation to the main competitor. The boston consulting group matrix provides the recommendations for the development of strategic resource allocation and strategy development in the typical multibusiness company. Analysis of business portfolio of a beverage company using bcg matrix free download as word doc. Based on science and research and development, the company permanently innovate its portfolio of food and beverages. The bcg growthshare matrix it is a portfolio planning model which is based on the observation that a company s business units can be classified in to four categories.
It would like to bring to the world a portfolio of quality beverage brands that. The cocacola company quotes, from inca kola, a sparkling beverage found in north and south america, and samurai, an energy drink available in asia. In dealing with the businesses, a company faces a lot of dilemma because if left. Boston matrix bcg matrix at the end of the 1960s, bruce henderson, founder of the boston consulting group, bcg, developed his portfolio matrix.
The bcg framework categorizes products within a companys portfolio as cash cows, stars, question marks or dogs based on their growth rate, market share, and cash flows. The bcg matrix, as the approach became known, is usually used to analyze corporations with multiple divisions or business units. Bcg matrix also referred to as growthshare matrix is a portfolio planning model which is based on the observation that a company s business units can be classified into four categories. The bcg matrix, developed by the boston consulting group, a leading management consulting firm, is the best known of these methods. The bestknown portfolio planning method is the boston consulting group bcg matrix.
If a company has several brands to look after, this matrix will help the managers. Bcg matrix what is it and how it helps in value investing. The bcg matrix is an excellent tool for analyzing the products or services of a company. A product portfolio is the products mix of market segments. The boston consulting group developed a matrix for assessing the product lines of a company, called the bcg matrix. Jul 07, 2015 in this article, we will look at 1 what is the bcg matrix, 2 understanding the bcg matrix, 3 how to apply bcg matrix to your company, and 4 some examples.
Over time they will become much larger and also large net generators of cash. The bcg matrix is based on the classification of sbus into question marks, stars cash. G matrix, that enjoyed a wide spread and use as a tool for resource allocation in a diversified enterprise. Portfolio analysis, bcg, ge, marketing implementation. The matrix categorises products as question marks, stars, cash cows, and pets also known as dogs.
Gemckinsey matrix brief history in the late sixties and early seventies, while the boston consulting group were devising the bcg or growth share matrix, general electric, a leading corporation in the united states, were also looking at concepts and techniques for strategic planning. Based on this assessment, the boston matrix helps in the longterm strategic planning of the company s portfolio, as it indicates where to invest, to discontinue or develop products. G matrix is considered the oldest, the simplest and the most known matrix of analysis of the portfolio of activities. The extended technique incorporates situation arising out of.
However, owning a product portfolio poses a problem for a business. The growth share matrix or the product portfolio many businesses require far more cash input than they can ever generate. As such, this working paper proposes the use of the family portfolio. Bcg matrix of samsung bcg matrix analysis of samsung. The growth share matrix or boston consulting group. In the boston consulting groups bcg growth share matrix, the suggested strategy for stars is to maintain position and after the market growth slows use the business to provide cash flow a cash cow, referred to in the boston consulting group portfolio management technique, refers to a business that has. Analysis of the portfolio of red bull based on the bcg matrix. Edraw can also convert all these templates into powerpoint, pdf or word templates.
1510 1561 1321 1286 338 971 14 838 701 1130 493 43 1515 512 1374 710 1467 821 683 287 680 898 1110 476 1345 294 888 135 1150 192 121 428 1136 984