Matrix can divide the market positioning of all products into four categories: problem products, star products, Taurus products and thin dog products. The characteristics of these four products and their marketing strategies are as follows:
(1) Problem products refer to products with high market growth rate but low relative market share. This kind of products need a lot of money to maintain the existing share, and if enterprises want to increase their share, they need more money. Therefore, the management must carefully consider and analyze the market prospect of this product and the reasons for its high market growth rate to decide whether it is worth spending more money to improve its market position. Problem products may not only be transformed into star products, but also be in danger of disappearing in the market at any time. Most of these products are risky products in the growth period of product life cycle.
(2) Star products refer to products with high growth rate and high market share. Although the sales volume has increased rapidly, it is a star product because of its high cost (such as raw materials, equipment, talents, sales, promotion and other expenses), which can not create a lot of profits for enterprises. Often in the growth period of product life cycle, it may be transformed into Taurus products and resisted by the market. Therefore, enterprises should adopt the policy of active development, improve product quality, reduce costs and strengthen after-sales service. In order to transform them into Taurus products as soon as possible.
(3) Taurus products refer to products with low growth rate but high market share. This kind of product has the advantages of low investment, low production cost and relatively low sales expenses, and can create rich profits for enterprises, so it is called Taurus product. Often in the mature period of product life cycle, enterprises should focus on protection, strengthen management, try to prolong their market life and prevent them from premature aging. Generally speaking, the more Taurus products an enterprise has, the better. It can be used to earn a lot of cash and support other market activities that require expensive products.
(4) Thin dog products refer to products with low growth rate and market share. More investment, less output, and significantly reduced profits, so it is called a thin dog product. Products have neither market development prospects nor sales potential, and are usually in the decline period of product life cycle. For this kind of products, enterprises should carefully analyze, if the market is impossible to recover, they should harvest as soon as possible and gradually retreat.