A portfolio planning tool for identifying company growth opportunities through market
penetration, market development, product development, or diversification
Company growth by increasing sales of current products to current market segments
without changing the product.
It might add new stores in current market areas
Improvements in advertising, prices, service, menu selection, or store design
Figure 2.3 The Product/Market Expansion Grid
—identifying and developing new markets for its current
products. For instance, managers could review new demographic markets
Perhaps new groups—such as seniors
Managers could also review new geographic markets
Third, Starbucks could consider
—offering modified or new
products to current markets.
Company growth through starting up or acquiring businesses outside the company’s
current products and markets.
Companies must develop not only strategies for growing their business portfolios but
also strategies for
There are many reasons why a firm might want to abandon products or markets.:
The firm may have grown too fast or entered areas in which it lacks experience.
-The market environment may change, making some products or markets less
-Finally, some products or business units simply age and die.
When a firm finds brands or businesses that are unprofitable or that no longer fit its
overall strategy, it must carefully prune, harvest, or divest them. Weak businesses
usually require a disproportionate amount of management attention. Managers should