More broadly, in a competitive market, any company must constantly adapt to market developments and the positioning of its competitors. Throughout the life of a company, the matrix represents at a given moment the positioning of a company’s offers compared to those of competitors (relative market share) and market attractiveness (market growth or sector).īy extension, marketing can use it to assess the balance of a product portfolio within the same business unit, in order to visualize which ones are profitable and which ones are struggling. When creating a business, it can be used to map the target market and the positioning of competing offers. In addition, the matrix accounts for the evolution of a product relative to its life cycle. It is a tool that can serve a company (in addition to other tools) at different times in its existence. It makes it possible to justify the allocation of resources assigned to a particular product or business unit and to operate a strategic reorientation to balance its portfolio and improve performance both by strategic unit and globally. Fields of application and interests of the BCG matrix In addition, other criteria can be integrated into the graphical representation (for example the size of the circles to represent the turnover of each product or business unit). Dogs (dead weights) for low market penetration in a low-growth marketĪ strategic approach cannot be based entirely on the sole use of the BCG matrix.Question marks (dilemmas): low market penetration in a high growth market.Cash cows: high market penetration and low market growth rate.Stars: strong market penetration and high market growth rate.This will make it possible to classify the products or Strategic business unit into four categories: The attractiveness of the market and the competitive position of each product of the company, or of each field of activity, are therefore represented. It is a graphical representation on two axes, the growth rate of the market (from weak to strong) in ordinates and the relative market share (from strong to weak) in abscissas.

This strategic and marketing tool is used to organize the portfolio of products and/or activities of a company.

The matrix in practice BCG matrix definition This matrix places each business unit or company product into a matrix that has two axes, namely market share and market growth. Still widely used in business strategy, this matrix allows you to represent your business portfolio according to the growth of the targeted market and the relative market share of the company. The BCG matrix is a strategic analysis tool designed by the Boston Consulting Group in the late 1960s, to optimizes long-term strategic planning in a company.

Bcg matrix for target company