IIS(DEEMED TO BE)UNIVERSITY

PAPER TITLE :- MARKETING MANAGEMENT

PAPER CODE:-402B
SUBMITTED TO: SUBMITTED BY:
DR. ASHMI CHHABRA AVNI JAIN
IISU/2019/ADM/31043
WHAT IS BCG MATRIX?

• BCG matrix is a tool that allows to classify and evaluate the products and services.
• According to this technique, the Matrix position the products/services classified as low or high performers in
two ways:-
1. The rate of the growth of the market.
2. The market share of a product/services offered facing the competitors.
• Boston consulting group Matrix was developed by Bruce Henderson of the Boston consulting group in the
early 1970s.
• The four cells of the BCG Matrix denotes
• Question mark, dogs, stars, cash cows.
 ADVANTAGES OF BCG MATRIX OF A
COMPANY:-
• BCG matrix is simple and easy to understand.
• It helps you to quickly and simply screen the opportunities open to you, and helps you think
about how you can make the most of them.
• It is used to identify how to operate cash sources can best be used to maximize a company's
future growth and profitability.
• To access profiles of products/businesses, the cash demands of product, the development
cycles of products, resource allocation and divestment decisions.
• Better Decision making.
 DISADVANATGE OF BCG MATRIX OF A
COMPANY:-
• The model uses only two dimension (i.e growth and share) to assess competitive position, others are
ignored.
• More focus on balancing cash flows rather than other interdependencies.
• More emphasis on cost leadership rather than differentiation as a source of competitive advantage.
• Poor correlation between market share and profitability. High market share does not necessarily
lead to profitability at all times.
• Low share or niche businesses can be profitable too (some dogs can be more profitable than cash
cows).
 HISTORY OF HYNUDAI:-

• CHUNG JU YUNG founded the Hyundai engineering and construction company in 1947.
• Hyundai motor company was late established in 1967.
• The company's first model, the Cortina, was released in cooperation with Ford motor company in 1968.
• In 1947, the pony, the first Korean car ,was released, with styling by Giorgio Giugiaro Italdesign and Power train
technology provided by Japan's Mitsubishi motors.
• In 1986, Hyundai begin to sell cars in the United States and the excel was nominated as "best product #10" by fortune
magazine, largely because of its affordability.
• CHUNG JU YUNG transferred leadership of Hyundai motors to his son, CHUNG MONG KOO, in 1999.
• Hyundai motors company entered the Indian automobile market 1996 currently the second largest automobile market
from India.
 BCG MATRIX OF HYUNDAI

• The BCG Matrix for Hyundai will help Hyundai in implementing the business level strategies for its business
units. The analysis will first identify where the strategic business units of Hyundai fall within the BCG Matrix for
Hyundai.
 1. STARS

• The financial services strategic business unit is a star in the BCG matrix of Hyundai.
• It operates in a market that shows potential in the future. Hyundai earns a significant amount of its income from this
SBU.
• Hyundai should vertically integrate by acquiring other firms in the supply chain. This will help it in earning more
profits as this Strategic business unit has potential.
• The Number 1 brand Strategic business unit is a star in the BCG matrix of Hyundai, and this is also the product that
generates the greatest sales amongst its product portfolio.
• The potential within this market is also high as consumers are demanding this and similar types of products.
 2. CASH COWS

• The supplier management service strategic business unit is a cash cow in the BCG matrix of Hyundai.

• This has been in operation for over decades and has earned Hyundai a significant amount in revenue.

• The market share for Hyundai is high, but the overall market is declining as companies manage their supplier themselves
rather than outsourcing it.

• The recommended strategy for Hyundai is to stop further investment in this business and keep operating this strategic
business unit as long as its profitable.
• The international food strategic business unit is a cash cow in the BCG matrix for Hyundai. This business unit has a high market share of
30% within its category, but people are now inclined less towards international food.

• This change in trends has led to a decline in the growth rate of the market.

• The recommended strategy for Hyundai is to invest enough to keep this strategic business unit under operations. If it no longer remains
profitable and turns into a dog, then Hyundai should divest this strategic business unit.
 3. QUESTION MARKS

• The local foods strategic business unit is a question mark in the BCG matrix for Hyundai.
• The recent trends within the market show that consumers are focusing more towards local foods. Therefore, this market is showing a high market
growth rate.
• Hyundai has a low market share in this segment. The recommended strategy for Hyundai is to invest in research and development to come up with
innovative features.
• This product development strategy will ensure that this strategic business unit turns into a cash cow and brings profits for the company in the
future.
• The confectionery strategic business unit is a question mark in the BCG matrix for Hyundai.
• The confectionery market is an attractive market that is growing over the years. However, Hyundai has a low market share in this attractive market.
• The low sales are as a result of low reach and poor distribution of Hyundai in this segment. The recommended strategy for Hyundai is to undergo
market penetration, where it pushes to make its product present on more outlets. This will ensure increased sales for Hyundai and convert this
strategic business unit into a cash cow.
 4. DOGS

• The plastic bags strategic business unit is a dog in the BCG matrix of Hyundai.
• This strategic business unit has been in the loss for the last 5 years.
• It also operates in a market that is declining due to greater environmental concerns. The recommended strategy for Hyundai
is to divest this strategic business unit and minimise its losses.
• The artificially flavoured products strategic business unit is a dog in the BCG matrix for Hyundai.
• These products were launched recently, with the prediction that this segment would grow.
• with increasing health consciousness, people are now refraining from consumption of artificial flavours. The market is
shrinking, and Hyundai has no significant market share. The recommended strategy for Hyundai is to call back this product.
THANK YOU