Ansoff Matrix

Question 1

What is the Ansoff Matrix?

Answer 1

A marketing planning model that helps a business determine a product and market strategy

Question 2

What are the four elements of the Ansoff Matrix?

Answer 2

1. Market penetration
2. Product development
3. Market development
4. Diversification

Question 3

What is market penetration?

Answer 3

A business sells existing products into existing markets

Question 4

What is product development?

Answer 4

A business sells new products into existing markets

Question 5

What is market development?

Answer 5

A business sells existing products into new markets

Question 6

What is diversification?

Answer 6

A business sells new products into new markets

Question 7

What are the benefits to market penetration?

Answer 7

1. Business focuses on markets and products it knows well
2. Exploit insights on what customers want
3. Unlikely to need lots of new market research

Question 8

Evaluate product development

Answer 8

1. It plays to the strengths of an established business
2. Requires effective market research and successful innovation
3. A great way of utilising the existing customer base
4. It is important to be first to the market

Question 9

Evaluate market development

Answer 9

1. A logical strategy where existing markets are saturated or in decline
2. More risky than product development
3. Existing products may not suit new markets

Question 10

Evaluate diversification

Answer 10

1. There is no direct experience of the product or market
2. There are fewer economies of scale
3. If it is successful, however, it is good long term