Ansoff Growth Strategy Essay

1100 Words3 Pages

The growth strategies are part of Ansoff’s matrix. The first one is the market penetration which is low risk strategy of using low pricing in the short term as a means of gaining entry into a new market or to increase market share or sales volume in an existing market. The second one is product development, this is where the company develops new features on a well-known brand and this is a medium risk strategy. The third is market development, this is where the company launches the same product but in another place, for example global. The last one is diversification, this is a high risk strategy this is when they enter a new market with a new product. Apple use mostly product development, they use these in their IPhone, the IPhone well known …show more content…

They also use market development as they have sold IPhones in more than 100 countries, this is an advantage because there are more places for IPhone to make a profit. The disadvantage of product development is that it can get costly because resources are required by the Research and Development department of the business; a lot of experiments and tests are also performed. Secondly, product development involves a risk of whether the consumers will like the new features that have been developed/added to the new/existing product. Tesco use the market penetration as the sell the same products to the same market, they don’t develop the products they sell the same general merchandise and groceries. An advantage of this is that by selling the existing products to the existing market it will speed up the growth of business because people will continuously buy them. A disadvantage of market penetration is the price-conscious customer may only make purchases based on how much the product costs while placing less emphasis on quality or brand recognition. These consumers generally are not loyal to a product or brand unless it continuously offers the lowest …show more content…

Branding aims to establish a significant and differentiated presence in the market that attracts and retains loyal customers. Branding is important for customers because the customer knows that the company they are buying from if there were two phones at the same price and same product but one was apple and the other were a unknown company, people would buy the apple because it is apple and they have shown their products to be of high quality. Also people would buy from Tesco because their branding is that there groceries are cheap and of high quality. Apple have built their brand up and their position. When people buy an apple product, they know the product will be of a high quality, that is the message that apple are trying to convey. One of the ways they have done this is that they train staff to present a specific image, so when you go to an apple store you will see that the staff carry with them IPads and other apple devices. Tesco have built their brand and positon to have the finest own-labeled products. They have done this buy making more Tesco brands. Brand extension is a common method of launching a new product by using an existing brand name on a new product in a different category. Apple use brand extensions because apple have launched many products under the same brand ‘apple’. Tesco use

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