BCG MATRIX
The BCG matrix helps us to analyze different business units or product lines and helps the companies to allocate resources optimally for marketing, product management, strategy development etc. The chart is a graphical tool to plot the products and services of a company to help make strategic business decisions. The y-axis of the graph represents the market growth rate while the x-axis represents the market share.
The components of the matrix
The chart or the graph has 4 categories:
1. The Cash Cows: It indicates a large share of the market by the company or its particular product or service in a slow growing market. This indicates that the investments needed to retain the position would be less in comparison to the revenues that …show more content…
Cash Cow: These are the products that have a high market share in a slow growing market. These products were at the top of their segments but the market being saturated the market growth has stagnated but given their edge in the market they have turned into cash cows for Unilver by generating revenues without any serious investments in them in terms f marketing etc. This is the category that generates revenue for Unilever to be invested into the brands that lie in the dog or star category. The best example for this would be Marmite which is a food spread usually used over breads or other food items. This brand has been consistently generating revenues in the spreads industry which is slowing down especially in the Europe and North America regions and the investments have been mostly about regular …show more content…
Analysis of Unilever brands with respect to BCG matrix
Uniliver has managed its portfolio in an effective manner in order to maximize the cash cows and stars in its portfolio while selling off the dogs. This might help Unilever witness brands like T2 become future Dove or Lipton but smart investments and marketing strategies might enable it to prolong the cash cow stage and hold the decline in the later life phases of the brand.
There are some limitations with the BCG matrix especially due to the size of Unilever and the manner in which its investments can influence the market itself. For example, Lipton is the the world’s best selling tea brand but an added investment by Unilever might push the growth of the entire market and make it appear as a star when in fact it is a cash cow. Also, Unilever being a highly diversified company with global presence the same brand might appear to be a dog in one region while the market for the same product might be growing in another region and make it a star or a question
The BCG matrix helps us to analyze different business units or product lines and helps the companies to allocate resources optimally for marketing, product management, strategy development etc. The chart is a graphical tool to plot the products and services of a company to help make strategic business decisions. The y-axis of the graph represents the market growth rate while the x-axis represents the market share.
The components of the matrix
The chart or the graph has 4 categories:
1. The Cash Cows: It indicates a large share of the market by the company or its particular product or service in a slow growing market. This indicates that the investments needed to retain the position would be less in comparison to the revenues that …show more content…
Cash Cow: These are the products that have a high market share in a slow growing market. These products were at the top of their segments but the market being saturated the market growth has stagnated but given their edge in the market they have turned into cash cows for Unilver by generating revenues without any serious investments in them in terms f marketing etc. This is the category that generates revenue for Unilever to be invested into the brands that lie in the dog or star category. The best example for this would be Marmite which is a food spread usually used over breads or other food items. This brand has been consistently generating revenues in the spreads industry which is slowing down especially in the Europe and North America regions and the investments have been mostly about regular …show more content…
Analysis of Unilever brands with respect to BCG matrix
Uniliver has managed its portfolio in an effective manner in order to maximize the cash cows and stars in its portfolio while selling off the dogs. This might help Unilever witness brands like T2 become future Dove or Lipton but smart investments and marketing strategies might enable it to prolong the cash cow stage and hold the decline in the later life phases of the brand.
There are some limitations with the BCG matrix especially due to the size of Unilever and the manner in which its investments can influence the market itself. For example, Lipton is the the world’s best selling tea brand but an added investment by Unilever might push the growth of the entire market and make it appear as a star when in fact it is a cash cow. Also, Unilever being a highly diversified company with global presence the same brand might appear to be a dog in one region while the market for the same product might be growing in another region and make it a star or a question