ITPEC FE Morning April 2020 Question 67
In a growth matrix proposed by Ansoff, which of the following is a strategy for an organization that tries to expand a business by introducing new products into new markets?
Explanation
Diversification — in Ansoff's product-market matrix, new products in new markets is the diversification quadrant.
Ansoff crosses products (existing or new) with markets (existing or new):
Answer (a)
Why not others:
- •(b) Market development — existing products taken into new markets, such as new regions or customer groups
- •(c) Market penetration — existing products sold more in existing markets, raising market share
- •(d) Product development — new products offered to existing markets
Key rule: Each Ansoff strategy is named after what changes; when both product and market are new the risk is highest, and that cell is diversification.
Business Strategy Management · AI-written, may contain errors
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