Products having a high market share in a fast-growing market.

Cash cows: Products with low market growth + high market share.

Dogs: Products with low market growth + low market share.Stars: Products with high market growth + high market share.Question marks: Products with high market growth + low market share.Each of these cells illustrates a particular type of business. The four cells of the BCG matrix are called – stars, cash cows, question marks and dogs. Resources are assigned to the business units as per their situation on the grid.

The vertical axis depicts the growth rate of a product and its potential to thrive in a particular market. Using Relative Market Share helps measure a company’s competitiveness. The horizontal axis represents the portion of the market share of a product and its strength in any particular market. The BCG matrix is based on the idea that a company’s products can be classified into four categories based on their market share and market growth rate. It was developed by the Boston Consulting Group in the 1970s and is still widely used today.īGC in other terms is a competitive analysis of business potential and the evaluation of the environment. However, if the Star product can survive and maintain the market share until the market becomes mature cycle (which is less competitive) the Star product will transform into a Cash Cow that no longer needs a huge investment to compete, but generate high revenue from the high relative market share.The BCG matrix – also known as the Boston Consulting Group matrix or Growth Market Share matrix is a strategic management tool used to evaluate a company’s product portfolio. So, having a lot of Star in the company’s portfolio is not a good idea. On the downside, the high level of market growth means this product demands more investment to maintain the market share, maximize returns, and sometimes to compete with price. Since the star products are in the high relative-growth market they will demand more investment to maintain market share.Stars in the BCG matrix represent a product with a high market share in the high relative-growth market.The star is in the top-right quadrant in the BCG matrix However, the company needs to invest heavily in them to maintain their growth and maximize returns. The stars are the most important category in the company’s portfolio because they are the future of the company. Normally, the star products are enjoying a very high market share position or it has a significant feature as an advantage over the competition like the iPhone before the boom of Chinese android phone. The products within the star quadrant in the BCG matrix have a strong competitive performance in the market and they have high future potential. Stars in the BCG matrix represent a product with a high market share in the high relative growth market.

Bcg matrix star company