Ansoff's Matrix

Revision notes for Unit 3 Business studies Edexcel on Ansoff's Matrix

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Harry Bindloss
ANSOFF MATRIX
Ansoff's Matrix: A method by which businesses can classify their strategies for expansion.
It includes; Market Penetration, Product Development, Market Development and
Diversification.
Market penetration
Market penetration is the name given to a growth strategy where the business focuses on
selling existing products into existing markets.
Market penetration seeks to achieve four main objectives:
· Maintain or increase the market share of current products ­ this can be achieved by a
combination of competitive pricing strategies, advertising, sales promotion and perhaps
more resources dedicated to personal selling
· Secure dominance of growth markets
· Restructure a mature market by driving out competitors; this would require a much more
aggressive promotional campaign, supported by a pricing strategy designed to make the
market unattractive for competitors
· Increase usage by existing customers ­ for example by introducing loyalty schemes
A market penetration marketing strategy is very much about "business as usual". The
business is focusing on markets and products it knows well. It is likely to have good

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Harry Bindloss
information on competitors and on customer needs. It is unlikely, therefore, that this
strategy will require much investment in new market research.
Market development
Market development is the name given to a growth strategy where the business seeks to
sell its existing products into new markets.…read more

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