The Marketer's Handbook: Reassessing Marketing Techniques for Modern Business



PORTFOLIO ANALYSIS AND MANAGEMENT

Application: New Revenue Streams, New Offers

The Concept

Product portfolio management is a much discussed aspect of marketing theory. It is argued that, in order to stay competitive, a business must continue to offer an up-to-date and broad range of products in a relevant way to a particular market. If a company is offering a range of products that are, for example, all reaching the end of their life, then its survival is threatened; a high risk position. Theorists argue that new offers should be created before this dangerous situation is reached. Logic would imply that such a strategy is relevant to most businesses and that a regular competitive review of the range of offers would benefit the firm.

There are various techniques to help with portfolio planning:

(i) The Boston Matrix is meant for the leadership of firms who own a range of different businesses which each focus on different markets. The varying competencies and phases of development of these different businesses in their different markets allow them to be managed and resourced in different ways. The Boston Matrix conveys complex information, like their position relative to competitors, very easily. (It is technically incorrect to use it on a portfolio of individual products or services that are not SBUs.)

(ii) The “McKinsey/GE Matrix” (or Directional ...