Question

(GPS watches)brainstorm ideas for product growth using each of the categories in the market matrix.

Answer 1

Ideally for product growth or business growth, we tend to brainstorm around two major segments:

1. New Market OR Current Market

2. New Product OR Current Product

Now to analyse the growth strategy for your GPS watches as a bsiness idea, lets consoder below possible growth matrix:

Now as far as the Idea of GPS Watches is concerned, it could fall in one of the above growth matrix.

Now let’s examine each of the above case and how you can target to grow your business of GPS Watches.

Case 1: Market penetration

Consider your GPS WATCHES is like a current product and you are trying to sell in current/existing market. If yes, Market Penetration could be best fit here.

Market penetration strategy is the preferred and one of the most common ways of growing your business.

Here your focus should be on selling more of products to:

1.    Your existing customers
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2.    Customers similar to your existing customers who are buying from your competitors
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3.    Customers similar to your existing customers who should be buying the product because they have a clear need but aren’t doing so.

The emphasis is on increasing market share through more marketing promotions, more effective marketing and by strengthening the offer by creating more customer value.

Case 2: Product Development

Consider your GPS WATCHES as a product is NEW to the market where as you are trying to sell it to the current/existing customers who represent the market on broader scale.

Here your focus should be based on below tactic:

1.    See to replace existing products with something better/new varient
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2.    To provide complementary products that customer needs to buy before, during or after purchase of the main product sold by the same business entity.
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3.    To sell other products the customer buys as a way to strengthen or leverage the relationship and to provide added convenience. Like “one stop shop”.

Case 3: Market Development

Consider your GPS WATCHES are like one of the existing product in the market but you are trying to sell it into completely NEW market; this strategy defines the Market Development matrix.

Here your approach should be:

1.    You should try opening up previously excluded market segments through pricing policies e.g. discounts for students and old age pensioners at theatres.
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2.    Try new marketing and distribution channels. Making a product available on the Internet with the necessary search engine optimization means that anyone looking can find it, rather than rely on your marketing message to reach them by convention means. The supermarkets sell financial services to people who wouldn’t contact a broker or agent.
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3.    Try entering new geographic markets by moving from local to regional to national and finally international. This may require the business to acquire new capabilities including exporting, understanding different cultures and language skills.

Case 4: Diversification

Consider your GPS WATCHES are completely NEW product segment in the market and you are trying to sell it into completely NEW market; thus you are trying to create Diversification in whole sense.

This option is the most controversial since diversification involves taking new products to new customers.

There are three approaches to diversification:

1.    Diversification into related markets – while the customers and products are both new, try to launch your GPS Watches as a product in related markets which should make sense to the consumers there.

2.    Diversification into unrelated markets using existing resources and capabilities – while the customers and products are new and different, they all rely on the existing strengths of the business. You will be able to move across markets and produce custom designed GPS Watches relatively easily because customers are buying access to the core competences from new product.
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3.    Diversification into unrelated markets which require new resources and capabilities.

Diversification is the most risky growth strategy and especially if it requires the development of new resources and capabilities.

The above growth matrices analysis concludes answer to this question.