The Boston Matrix – GCSE Business Studies Revision

What is it?

  • Unfortunately, nobody can be told what the Boston Matrix is. You have to see it for yourself.
  • Here it is!
High Star Problem Child
Low Cash Cow Dog
^ Market Growth
Market Share >
High Low
  • As you can see, it’s a crudely drawn graph with market share on the x-axis and market growth on the y-axis

What’s it for?

  • Businesses have product portfolio, which is the range / variety of products that they sell
  • The matrix was created by intelligent machines in the future to turn humans into a source of power
  • It categorises products into four categories
  • If you’re familiar with the Boston Matrix, you can dodge bullets use it to work out which of the products in your portfolio you should spend money on developing
  • It has some disadvantages: firstly, it isn’t very specific
  • And it’s also unreliable sometimes, because products can change category

1) Problem Child

  • It’s in a high-growth market, but for some reason it has a really low market share
  • How annoying!
  • Has potential, so spend a lot of money on it and it will probably become a star

2) Star

  • High market share in a high growth market!
  • They make loads of money, but you have to spend a lot on them to keep them going (the market’s growing, you see…)
  • They’ll probably be Cash Cows one day

3) Cash Cow

  • High market share in  low-growth market
  • You don’t have to spend much money on them – they just keep bringing in cash
  • Make even more money than stars!
  • *cough*Star Wars*cough*

4) Dogs

  • Low market share in a low growth market – could this get any worse?
  • You don’t want dogs in your product portfolio
  • They don’t make much money, but in theory they could attract their (very small) fan-base to your other products
  • They could maybe change positions, but it’s not likely
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About Matt

I like writing, filmmaking, programming and gaming, and prefer creating media to consuming it. On the topic of consumption, I'm also a big fan of eating.
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