SWOT ANALYSIS , helps you develop business strategy

Where do What are What

What do you need your obstacles
you to growth do you
do well? improve? prospects face?
?

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 Include things that Include things that your
your company or company is not doing well
project does or needs improvements
extremely well.
E.g. Shortage of skilled
E.g. Brand attributes, people, financial
people, strong limitations or lack of
leadership etc. clearly defined USP.

Include everything you Include things that

could do to grow as a pose a risk to the
company. All possibilities company.

E.g. Tapping other E.g. Emerging

markets to improve the competitors,
sales, using advanced financial
technology for better risks, changes in
results. regulatory law etc.

Interesting Read: : A different approach to SWOT

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 STRENGTH WEAKNESSES
• Extensive distribution network • Limited market share due to
• Innovative FMCG company presence of strong FMCG brands
• Brand visibility • Faced controversies like skin
• Products with presence in over 20 lightening cream
consumer categories • Market Saturation

OPPORTUNITIES THREATS
• Improve penetration in low • Competition from local products like
performing portfolio such as Oral Patanjali
Care & Deodorants • Increasing competition amongst
• M&A to strengthen the brand other FMCG companies
• Increasing purchasing power of • Portfolio such as Oral care &
people thereby increasing deodorant segment losing market
demand share

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BCG MATRIX
The BCG matrix (or Growth-Share Matrix),
is a planning tool used to evaluate the
Strategic position of a business brand
portfolio and its potential. It classifies

Increasing Business Growth Rate

business brand portfolio into four categories
on the basis of industry attractiveness Star Question Mark
Expand Improve or Divest
(growth rate of that industry) and
competitive position (relative market share).
The BCG analysis helps the company in
deciding which entities in the business
Cash Cow Dog
portfolio are Harvest Divest
actually profitable and which are not. This
helps businesses identify what it should
concentrate on and what gives it a Increasing Relative Market Share
competitive advantage over others.

Relative market share: Represented by the horizontal axis. Higher market

share results in higher cash returns. The mid-point is generally set at 1.0.
Market growth rate: Represented by the vertical axis. Higher market growth
rate might lead to higher returns in future, but this requires investment to
stimulate further growth. So, this would lead to higher cash usage.

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4 Categories of the BCG Matrix
Stars: High Market share
Question Marks: Low Market Share
High Growth High Growth

• .The business units or products that have the best market • Question marks are growing rapidly and thus consume large
share and generate the most cash amounts of cash, but because they have low market shares they
are considered stars. do not generate much cash. The result is a large net
• Monopolies and first-to-market products are frequently cash consumption.
termed stars. • They have the potential to gain market share and become a
• However, because of their high growth rate, stars also star, and eventually a cash cow when the market growth slows.
consume large amounts of cash. • If the question mark does not succeed in becoming the market
This generally results in the same amount of money coming leader, then after perhaps years of cash consumption it will
in that is going out. degenerate into a dog when the market growth
• Stars can eventually become cash cows if they sustain declines
their success until a time when the
market growth rate declines.
• Companies are advised to invest in stars.

Cash Cows: High Market share Dogs: Low Market Share

Low Growth Low Growth

• Cash cows are the leaders in the marketplace and Dogs have low market share and a low growth
generate more cash than they consume. rate and thus neither generate nor consume
• They provide the cash required to turn question marks a large amount of cash.
into market leaders, to cover the • They are cash traps because of the money tied
administrative costs of the company, to fund research and up in a business that has little potential.
development, to service the • Such businesses are candidates for divestiture.
corporate debt, and to pay dividends to shareholders. Strategies for Dogs:
• Companies are advised to invest in cash cows to maintain • The company can either divest the product
the current level of productivity, altogether.
or to "milk" the gains passively. • Product can be revamped through rebranding /
innovation / adding features etc.

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Few Strategies for BCG Products:
Question marks (Low market share, High growth prospects)

• Question marks must be analyzed carefully in order to determine whether they are worth the investment
required to grow market share.
• Companies are advised to invest in question marks if the product has potential for growth, or to sell if it does
not.

Stars (High market share, High growth prospects)

All types of marketing, sales promotion and advertising strategies are used for Stars because of
the high competition and rising market share to increase and retain market share.

Cash Cows (High market share, Low growth prospects)

• Strategy generally includes retention of the market share.

• Thus customer satisfaction programs, loyalty programs and other such promotional
methods form the core of the marketing plan for a cash cow product.

Disadvantages of BCG Matrix:

• The model uses only two dimensions (i.e. growth and share) to assess competitive
position, others are ignored.
• More emphasis on cost leadership rather than differentiation as a source of competitive
advantage.
• A high market share does not necessarily lead to profitability at all times.
• Assumes that each business unit is independent of the others. In some cases, a business
unit that is a "dog" may be helping other business units gain a competitive advantage.

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 BCG Matrix of Amul

Amul has diversified their offerings,

Increasing Business Growth Rate

entering into different milk and milk

product markets, let us understand
Ghee and BCG Matrix of Amul.
Lassi
Ice cream
Cash Cows :
The 3 products mentioned in the
figure (milk, butter, cheese)
Milk, Butter and Cookies and generate steady, high revenue.
Cheese Pizza They are the “flagship” products of
the brand.
Increasing Relative Market Share

Stars: Question Marks: Dogs:

Amul invests a lot of cash Amul Lassi falls under this Due to the heavy
coming from cash cow into category. competition & limited
star-product promotions. Considering the increasing innovation in these
Amul Ice Creams have demand for healthy products, products, it’s difficult for
targeted & appealing ads in this category shows a huge Amul to gain market share
order to improve awareness potential to grow. & generate huge revenue.

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BCG Matrix of Amazon
Increasing Business Growth Rate

Kindle Fire TV Amazon Video

Alexa Music

Increasing Relative Market Share

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Interesting Read: BCG Matrix on the World of Ice Cream
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