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Chapter 2: Creating Customer Value: Product to Experience Back To Chapter

2.19: Brand and Product Portfolio

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Brand and Product Portfolio

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2.18: Product Lifecycle and Relevant Strategies

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A brand portfolio represents all brands under a company, while a product portfolio comprises all products under these brands.

Brand and product portfolio management involves organizing and monitoring these portfolios using tools like the Growth Share Matrix.

The Growth Share matrix classifies a company's products or brands into four quadrants: Cash Cows, Question Marks, Stars, and Pets, based on market share and market growth rate.

For instance, Toyota's well-established brands like Corolla and Camry are "Cash Cows" with high market share and stable growth.

It would require strategies for retaining customers and diversifying product offerings by investing in new ventures, like EVs.

"Question marks," such as EVs, would require investments in advertising and promotion to increase market share.

The "Stars" include innovative lines like all-new hydrogen cars, which require aggressive marketing to sustain the market share.

Older brands like Venza, with declining sales, are considered "Pets" and would require phasing out if repositioning is impossible.

Efficient matrix management allows businesses to allocate resources, supporting brands according to their potential.

2.19: Brand and Product Portfolio

The Growth Share Matrix is a strategic tool for managing brands and product portfolios. Based on market growth rate and market share, it categorizes products into four quadrants—Stars, Cash Cows, Question Marks, and Pets. Stars are high-growth, high-market-share products with the potential to become Cash Cows, which are low-growth, high-market-share products that generate surplus cash. Question Marks are high-growth, low-market-share products requiring substantial investment, while Pets are low in both growth and market share, barely generating enough cash.

This matrix assists in:

• Portfolio analysis by helping businesses turn Question Marks into Stars using funds from Cash Cows.
• Resource Allocation as businesses might invest more into 'Stars' and 'Question Marks' while maintaining 'Cash Cows' and phasing out 'Pets.'
• Strategic Planning as marketers can develop strategies for each category to maximize profit and growth. For example, they could use 'Cash Cows' revenues to fund potential 'Stars.'
• Performance Evaluation is where businesses can see if a product moves from a 'Question Mark' to a 'Star' or if a 'Star' falls to become a 'Pet,' indicating the need for revised strategies.
• Competitive Advantage: Marketers can identify opportunities for competitive advantage by understanding their product positioning through the Growth Share Matrix.

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