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17 Terms
What is strategic direction?
Sets out which market a business will compete in and what products it will offer
What is market penetration?
Involves developing strategies to boost sales of existing products in existing markets
What is market development?
Involves offering existing products but targeting new market segments with them
What is product development?
Involves developing new product for existing customers
What is diversification?
Involves offering new products to new customer groups
What is ansoff’s matrix?
It is one way a business can analyse its strategic direction, it considers a firms strategy and the markets it operates in
What is an example of market penetration?
Selling more energy drinks to existing customers
What is an example of market development?
Selling current products in a new country
What is an example of product development?
Launching a new vegan chocolate bar
What is an example of diversification?
Creating a completely new product for a new market
What is a downside of market penetration?
If you already have a high market share opportunities may be limited
Market penetration may increase competitive rivalries
Business may ignore opportunities and threats from new products
What is globalisation?
Few global products that don’t make any concessions to local market needs
What is a downside to diversification?
It is the riskiest growth strategy as it requires the development of new recourses and capabilities
What are factors to consider for selecting a strategy?
Expected costs
Expected returns
Opportunity cost
Risk to finances and the brand
Does it fit with the businesses recourses and strengths
The impact on the stakeholders
The ethical issues involved
What is strategic positioning?
How a business positions itself relative to its competitors
Competitive advantage?
An advantage a business has over its competitors gained by offering customers greater value
What is cost leadership?
A strategy that involves achieving lower costs than rivals in the same industry
Note 
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