Question

Please consider a product of your choice and use the BCG (Boston Consulting Group) matrix to determine whether the product is a star, a question mark, a cash cow, or a dog. What steps would you take to achieve cost leadership and differentiation for the product?

Answer 1

Answer 1:

The product chosen is Apple’s iPhone.

As per the BCG matrix, the iPhone is a cash cow for Apple because:

· The iPhone is Apple’s largest source of revenue

· iPhone sales generate a steady flow of revenue for the company

Answer 2:

To achieve cost leadership, I would focus on reconfiguring the value chain and reduce various costs and wastages. This will result in increased profitability for the firm. The reduction in costs will enable me to price my products lower than the competition. Charging lower prices will enable me to gain higher market share.   

To achieve product differentiation, I would focus on developing innovative product features by investing additional resources in research and development. I will highlight the product’s unique features and attributes to differentiate it from the competition. This will also help generate additional value and increase customer loyalty.