Ansoff’s model is one of the strategic techniques that an organisation can use to achieve a competitive advantage. Analyse this technique.
Ansoff’s Matrix was designed to show how the markets and their products can be manipulated to the advantage of the organisation. It has four sections that are depicted as, Market Penetration, Product Development, Market Development and Diversification.
This method uses the existing products and increasing existing market shares while using the existing customers. This means that you basically use what you’ve got and try to make them better or re-sellable. Doing this can give the organisations’ reputation a bit of an enhancement to differentiate it from their competitors. In the tourism and hospitality industry certain incentives can be given to regular guests, such as frequent flyer miles or season tickets to a recreational park or hot spring. This can also mean that the existing core competencies have to be enhanced as well for a better competitive advantage.
This method involves new products that are produced for the existing market of the organisation. The whole point of this method is to gather new customers, keep the regular customers and increase the market share of the organisation. In the hospitality industry there are numerous examples, for instance, a certain travel agent or tour operator has only been selling packages made up of the airline, accommodation and transport, now decides to add something new to its selection, like a health club or spa.
Finding new markets for existing products can sometimes be a little bit tricky. Most common features of market development are globalization and internationalisation. Opportunities for market growth will arise when the organisation effects market development strategy.
Three types of Diversification: Simply said, new market, new product. There are some strategies of diversification that include alliances, licensing of new techniques, introducing a new product developed by another organisation...