Marketing is one of the primary drivers of a business, yet all too often businesses get it wrong. Utilising a team of experienced and innovative marketing professionals, The Advisory Firm can tailor a comprehensive marketing plan to match your business objectives. Your business can have the edge through effective strategic development and implementation expertise. By knowing what to communicate, scheduling when and how, you can comfortably predict the growth pattern and rely on your revenue streams.

The Advisory Firm can work on all aspects of market commercialisation such as:

- Strategic Marketing Plans and Market Validation
- Market Research (Competitor & Customer profiling)
- Communication Strategies, Promotions and Marketing Workshops
- Collateral, Brand and Identity Development
- Channel Development and Incentives
- Tactical Strategies to barriers to consumption

Marketing is the process of engaging and understanding your environment, knowing your products and having the ability to enthusiastically communicate this to your market. If you need to generate more customers, who visit more often for a wider range of products , perhaps you should be talking to The Advisory Firm, we can take you where you want to go.

The Advisory Firm knows from experience how to access the channels you need to shift product and create brands and let us respond on how to develop your market. Please read our Fast Answers on handling exponential growth - go here.

The Advisory Firm: Key Concept: The BCG Product Matrix

Developed by The Boston Consulting Group in the 1970s, the Boston Matrix remains a valuable tool to assist in product/service portfolio planning. The framework classifies product lines (or business units) on the basis of their market share and their market growth, and can be applied to develop a strategy for business units and for maintaining a balanced product portfolio. An underlying objective in applying the framework is to ensure equilibrium between cash-generating products and cash-absorbing products.

The matrix is made up of four quadrants defined by market share on one axis, and market growth on the other axis. It is furthermore assumed that higher growth rates consume higher levels of cash, while higher market shares imply greater generation of cash. The positions on the matrix can therefore inform on the overall balance of the product or business unit portfolio, and provide guidance on actions to take on each product or business.

The first quadrant of the Boston Matrix represents the “Stars” – products/business units which yield more cash than the cash investment in them. However, Stars do need investment to maintain their position. As a result, they are not as profitable as the second quadrant, the Cash Cows.

The second quadrant represents the “Cash Cows” – products/business units with high market growth, generating more cash than the cash investments required for sustaining them. Cash Cows are mature products/business units in well-established markets, generating funds to support other parts of the business. They typically form the core of a business.

The third quadrant represents the “Dogs” – products in the declining stage of their life. As a rule, these products do not generate much cash, but they do absorb cash. Dogs may be Cash Cows past their prime – products/business units with minimal market share, operating in slow growing markets. Their profitability is declining and they must be divested if possible, or otherwise rapidly harvested.

The fourth quadrant represents the “Question Marks”, which are also sometimes referred to as “problem children” – products which generate less cash than is invested in them. These products are risky and require considerable funding, making them minimally profitable in the initial stages. Over time, however, these Question Mark products/business units could become Stars. Selecting the right Question Marks to grow into Stars and selecting the right ones to divest is a critical business decision.

The Advisory Firm Concept Commentary
The Boston Matrix can still be a useful first-cut view of a business portfolio, and to a lesser degree, a product portfolio. Obviously, a limitation is that the matrix is based on only two major variables, growth rates and market shares. More subtle traps associated with applying the model include:

The model rests on net cash consumption or generation as the fundamental portfolio balancing criterion. That is appropriate only in a capital constrained environment. In modern economies, with relatively frictionless capital flows, this is not the appropriate metric to apply – rather, risk-adjusted discounted cash flows should be used.

The matrix assumes products/business units are independent of each other, and independent of assets outside of the business. In other words, there is no provision for synergy among products/business units. This is rarely realistic.

Read our Fast Answers on handling exponential growth - here

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