Marketing strategy’s fundamental goal is to drive growth. The challenge has always been figuring out exactly how to do so.
Tactical changes like ad spend increases or audience targeting refinements can spur incremental growth, while product development investments can drive bigger (but riskier) returns. So how do you decide where your marketing strategy will focus?
Fortunately, a number of researchers have studied corporate growth over the years and created a robust toolset of growth models to help guide marketing strategy. Today, we’re going to talk about how to use one of our favorites, the Ansoff Matrix, in your marketing strategy
What is the Ansoff Matrix?
The Ansoff Matrix was developed way back in 1957 as a way to organize potential sources of corporate growth, and has dominated MBA courses ever since. The matrix organizes growth opportunities according to two axes: markets, and products.
- Market-Based Growth is customer-centric (an easy way to think of a market is as a group of like customers). Generally, you’re either looking to do a better job reaching a known market, or explore a new market to see what opportunities may exist.
- Product-Based Growth is category-centric (a handy definition of a category is a group of like products that serve a larger need, say shaving supplies). Growth solutions here may involve finding new uses for an existing product or developing new products.
In our version of the matrix below, we’ve outlined several opportunities to drive growth that exist within each Ansoff quadrant drawn from a Harvard Business Review study that analyzed 181 companies’ growth histories to understand the drivers of sustained profitable expansion. This list is by no means exhaustive, but gives examples of different growth sources your organization can look to include in your marketing strategy.
How Can I Use the Ansoff Matrix in My Marketing Strategy?
The Ansoff Matrix is the perfect growth model to use in growth planning and brainstorming sessions with your marketing team, product managers, and business unit leadership. It’s an ideal fit in situations where leadership expects marketing to identify solutions to growth goals, or where the department may not have a defined growth process. While the matrix in itself does not dictate marketing strategy, it highlights directions that your marketing and business development strategy might potentially take.
The next step once you’ve identified your potential growth opportunities is to rank those options by feasibility, which will likely involve internal research and discussion, external market research, and customer/influencer conversations. Your goal at this stage is to simply get a general sense of whether an opportunity feels viable, or whether you may be trying to cross a bridge too far. Armed with this early data, you can then build your marketing strategy’s foundation on the most viable opportunities.
Struggling with your marketing strategy? Not sure where to where to look for growth? Young Marketing Consulting can help. Contact us to schedule your marketing strategy consultation.