Boston Consulting Group (BCG) matrix is a visual marketing management tool used to analyse a firm’s product portfolio in terms of market share and growth of the whole market.

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Type of Product	Market Share and Growth	Description
Cow	High market share.
Low market growth.	High product sales, even higher than stars as they do not require extensive investment for marketing.
Well established products with a strong customer loyalty and good distribution.
PLC: Maturity phase.
Dogs	Low market share.
Low market growth.	Operates in declining markets and generate little profits. Either need to be replaced or eliminated.
PLC: Decline phase.
Stars	High market share.
High market growth.	Most successful products that generate high income. Requires high level of investment to maintain high market share. As time goes on, they can end up as cash cows.
PLC: Growth phase.
Question Marks	Low market share.
High market growth.	Require a large amount of investment as they are usually in a highly competitive market so high investment needed in promotion. Could become stars or dogs.
PLC: Growth phase.

Uses of BCG Matrix

Guide investment decisions. Identify which products have potential for high revenues then gather investments for it to grow.
Implementing changes. Plan which products should be taken action on and introduced.
Understand current position of existing products.

Benefits of a balanced product portfolio (BCG Matrix)

Increase brand awareness because allows greater business exposure.
Reduce the risks of being associated with having just a single product, e.g. seasonal fluctuations in demand.
Appeal to wider customer base, thus, also increasing firm’s revenue.

Limitations of BCG Matrix

Restricted to current products. Cannot predict the future.
Oversimplified. Complex factors are summarised into short phrases to determine product success.
Assumptions made. Especially that higher rates are related to higher market share.

→ Not the case for niche luxury markets or companies that obtain sales from cutting prices and having low profit margins. Both can be successful but is reflected poorly on the BCG.
Require clear data of market growth and share. So that the analysis is not subjective. Even with confirmed data, it fails to provide insight on the external situation.

→ Dogs. May not needed to be phased because in the future, it might be of opportunity and use.

Activities

Allen’s Gourmet Snacks

Stars	Question marks
Much Munch Protein Bars	Everyone Goes Nutes
Cash cows	Dogs
Cheesy Chips	Buttery-Fairy Popcorn