Updated
The BCG matrix (Boston Consulting Group matrix, also growth-share matrix) helps a company decide which products or services to invest in. It sorts them by two criteria: how fast the market grows and how big a share the company holds in it.
The four quadrants
- Stars: high growth, high share. They need investment to keep their position and often become future cash cows.
- Cash cows: low growth, high share. Stable profit with lower costs, they fund the rest of the portfolio.
- Question marks: high growth, low share. They may become stars, but need investment and clear decisions.
- Dogs: low growth, low share. Candidates for limiting or ending, unless they support other products.
Using the BCG matrix in marketing
The matrix helps split the budget. Stars and promising question marks may get more advertising, cash cows can run efficiently on profitable campaigns, dogs get minimal spend. In online stores the same logic works for product categories in Google Shopping or Performance Max.
Limits
The matrix simplifies reality. It does not include margin, synergies between products or the customer’s point of view, so use it together with other tools such as the Ansoff matrix or a SWOT analysis.
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