Product/Market Evolution Matrix
In the business world, the concept of product/market evolution matrix is increasingly becoming popular. This framework is intended to help firms determine the most suitable approach for their product lines and markets, identify the most suitable strategies for their product offerings, understand the nature of their competitive landscape, develop an appropriate marketing strategy, and measure the effectiveness of their current product/market performance. By examining the product/market evolution matrix, firms can make well-informed decisions regarding their business approach and capitalize on opportunities in their markets.
The product/market evolution matrix was developed by Richard C. Brandt, a business consultant and author of the book “Brands: The Strategic Marketing of Products, Companies and Brands.” The matrix is composed of five stages that companies go through when developing their product and market offerings: Product Search, Market Development, Product Launch, Market Saturation, and Market Optimization. Each stage is created to illustrate varying degrees of complexity. In the product search stage, a company is just starting out and is exploring different products and markets to enter. During the market development stage, the company begins to hone in on specific markets, products to offer, and targeting strategies.
When the company enter the product launch stage, the key decisions are about pricing, advertising, and positioning. At this point, the product may be physically available in markets or digitally available for customers to buy and use. In the market saturation stage, the company must focus on Promoting the product, getting feedback from customers, and tweaking the strategy until the product reaches its potential. Finally, in the last stage of market optimization, companies refine strategies based on customer feedback and look for ways to increase profits and customer loyalty.
So how does a company use the product/market evolution matrix to reach their desired outcomes? First, it can be used to pinpoint the most suitable markets to enter and the most optimal strategies to use. Through understanding the different stages, businesses can determine the right pricing, advertising and distribution strategies to deploy, and identify the most suitable product and positioning to reach their targets.
The product/market evolution matrix can also be used to compare and contrast different approaches to the same product. For example, if two firms are both selling athletic footwear, one might choose to focus on catering to a niche market while the other might choose to focus on providing the most popular designs for mass appeal. By examining the matrix, the two firms can compare the different stages of their products’ market penetration and understand the different strategies that each has employed in order to reach their goals.
In addition, businesses can use the product/market evolution matrix to evaluate their current performance and measure the success of their product/market efforts. By comparing performance across different stages, businesses can understand what has worked and what hasn’t, and formulate new strategies to increase their product/market reach and maximize their profits.
The product/market evolution matrix provides a basic framework that firms can use to chart their growth and create strategies to reach their desired results. By using this tool, businesses can identify which markets to target, what strategies to employ, and how to measure the effectiveness of their efforts. Ultimately, the matrix can be used to maximize profits and optimize customer satisfaction.
