Strategies for growth: Ansoff Matrix
May 26
It has been some time since I have delved into the lessons of my MBA to write a blog which may actually be of practical use to readers who are running a business. I hope this blog corrects this.
When running a business you are always faced with the challenge of how to grow the business. A useful analytical tool used by marketers and taught on business courses is the Ansoff matrix. It is a tool that I think is incredibly good and I do use it all the time. I hope you find it useful as well.
The starting point is that you are already in business selling your existing products to existing customers. You have three possible options in terms of where to go next.
1. Sell new products to existing customers
2. Sell your existing products to new customers
3. Sell new products to new customers
The options are listed in order of ease. The strategies should be pursued in this order. And yet many companies try to pursue option 2 or option 3. For example, I know too many examples of companies who are successful trying to pursue a strategy of selling into the USA. I believe that this is primarily driven by ego rather than a crying business need.
When selling into the USA (or indeed other export markets) you may find that your products do need to be substantially adapted. You are therefore moving to option 3 without even realizing it!
Selling new products to existing customers is always the best option to pursue. And you will notice that many of your customers will be looking to cut down on the number of suppliers they deal with. This could provide you with a golden opportunity to take a category approach and to link up with other suppliers who provide complementary products or services to the ones you may be supplying to your customers.
This can improve and strengthen your relationship with your customers as it may increase the number of times you see them – and build up more of a partnership approach. The margins will probably be lower than on your own products but it can be a very useful incremental revenue stream.
You will need to of course continue to focus on selling your existing products to new customers. Business needs you to continue to diversify risk and having more customers is a way of increasing revenue and diversifying risk. I have written many blogs before about increasing your sales (my specialty) and I hope you are able to use some of that advice to good effect.
With all things in life, planning is very important, but the execution is always more important.
Best of luck with the implementation!
Hi and welcome to my blog. 
