Ansoff Matrix

Tanay Kudapa
The Ansoff Matrix
• The Ansoff Matrix was
developed by H. Igor Ansoff
• Designed to help a firm decide
on its product and market
strategy.
• Risk of the employed strategy
failing, increases as we move
from left to right and from top
to bottom.
Market Penetration
• A growth strategy where a business aims to sell
existing products into existing markets.
• Objective: Increase market share.
• Business builds on its existing expertise of the
market and customers.
• New market research is not needed.
• Risk: Assessing if the market is growing rapidly
enough to accommodate increased selling
activity.
Product development
• A growth strategy where a business aims to
introduce new products into existing markets.
• Objective: Take advantage of existing
customers.
• Requires detailed market research and rapid
innovation.
• Businesses can leverage their existing products.
• Risk: Being first to market is important.
Market Development
• A growth strategy where a business aims to sell
its existing products into new markets.
• Objective: Capture new, untapped markets.
• Can be achieved through establishing new
distribution channels.
• Strategy usually employed when current
markets are saturated or have stopped growing.
• Risk: Localization may be required to tailor
products to new customers.
Diversification
• A growth strategy where a business aims to sell
new products into new markets.
• Objective: To reduce or spread risk.
• No prior experience of the product or the
market.
• Heavy investment required in innovation and
R&D.
• Possible method would be to acquire an existing
business which has existing competencies.
• Risk: Intrinsically a risky strategy.
Thank You