which means it helps to correctly analyze data
Posted: Thu Feb 13, 2025 6:42 am
The profits the company makes from the Cash Cows are usually used to develop the Stars and Question Marks.
Product life cycle
Each product goes through the stages of birth, development, maturity and decline. The level of demand and its relevance first increase, reach a plateau and decrease over time. The BCG matrix reflects this process.
Any goods and services appear on the market in the "Question Mark" position - they have a low share, even if the demand for similar products is high. In case of successful development, the market share of the product grows, and the "Question Mark" becomes a "Star".
Find life hacks, articles, tips and other useful materials on how to create a successful product and manage a business in the Compass blog on Telegram.
Over time, the market hype subsides, the overall level of demand greece phone number list and competition stabilizes, and the leaders become "Cash Cows". They no longer require investment and begin to bring very large profits to their owners.
At the last stage, demand falls, the product or service becomes irrelevant. The "Cow" turns into a "Dog" and eventually leaves the market. Or the company rebrands and reorients it to another niche.
This system makes it easier to understand the BCG matrix, make the right decisions and distribute resources as efficiently as possible.
The BCG matrix is based on the product life cycle model
How to build a BCG matrix
To build a matrix, you need to follow several basic steps.
Step 1: Select business units for analysis
The creation of a BCG matrix begins with the selection of the subject of the study. This can be an entire brand, a separate product or a product category. You can even compare sales channels or business areas.
Product life cycle
Each product goes through the stages of birth, development, maturity and decline. The level of demand and its relevance first increase, reach a plateau and decrease over time. The BCG matrix reflects this process.
Any goods and services appear on the market in the "Question Mark" position - they have a low share, even if the demand for similar products is high. In case of successful development, the market share of the product grows, and the "Question Mark" becomes a "Star".
Find life hacks, articles, tips and other useful materials on how to create a successful product and manage a business in the Compass blog on Telegram.
Over time, the market hype subsides, the overall level of demand greece phone number list and competition stabilizes, and the leaders become "Cash Cows". They no longer require investment and begin to bring very large profits to their owners.
At the last stage, demand falls, the product or service becomes irrelevant. The "Cow" turns into a "Dog" and eventually leaves the market. Or the company rebrands and reorients it to another niche.
This system makes it easier to understand the BCG matrix, make the right decisions and distribute resources as efficiently as possible.
The BCG matrix is based on the product life cycle model
How to build a BCG matrix
To build a matrix, you need to follow several basic steps.
Step 1: Select business units for analysis
The creation of a BCG matrix begins with the selection of the subject of the study. This can be an entire brand, a separate product or a product category. You can even compare sales channels or business areas.