3.8.1 Choosing Which Markets To Compete In & What Products To Offer

Question 1

What are “strategic choices” ?

Answer 1

Deciding the direction in which a business should move, and the method behind this plan

Question 2

What is “strategic direction” ?

Answer 2

Setting out which markets a business will compete in and what products it will offer

Question 3

What are the four stages of strategic choices ?

Answer 3

strategic direction ->
strategic positioning ->
strategic methods ->
strategic implementation

Question 4

What is the “Ansoff matrix” ?

Answer 4

A model developed by Igor Ansoff, which considers a firms strategy in terms of products and the market

Question 5

What are the four key areas of the Ansoff matrix ?

Answer 5

• market penetration (existing product; existing market)
• new product development (new product; existing market)
• market development (existing product; new market)
• diversification (new product; new market

Question 6

What is “market penetration” and what does it achieve ? (2)

Answer 6

• developing strategies to boost the sale of existing products in an existing market
• boost market share

E.g Investing in promotion or changing pricing approach