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Ansoff Matrix is one of the key growth strategy models - Discuss the strategies for one company in Hotel industry

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Question: Ansoff Matrix is one of the key growth strategy models that businesses can use. Explain this model with the help of a diagram. Also, use this model to discuss the strategies for one company in each of two industries below:
- Automotive industry
- Hotel industry

ANSWER:

Ansoff matrix consists of four growth strategies which include market penetration which is about the marketing of the existing product in the existing market so that significant value can be created and the product sale can get increased (Kalogiannidis and Mavratzas, 2020, p.121(4)). This way this strategy aids in business growth. The second one is market development. This talks about entering into a new market to have business expansion with the existing products. The third strategy is about product development. This strategy talks about the development of a new product or the introduction of an innovative or modified product in the existing market. This is beneficial for differentiating from the substitutes so that business growth takes place. The diversification strategy is about the introduction of new and innovative products in new markets to address the differentiation of products and have proper expansion.

In the automotive industry, the chosen organisation is Aston Martin. The use of the Ansoff matrix on the business growth of this organisation is discussed here.

Market penetration: This is about increasing business growth in existing marketing with existing products (Kukartsev et al., 2019, p.3(3)). In the case of Aston Martin, it has been found that they have started following the build-to-order model to avoid risks and they are reinvigorating their marketing activities in order to raise their brand awareness and make people aware of their innovative automotive designs and ideas (Astonmartinlagonda, 2022). Hence, this shows that the organisation is following a market penetration strategy.

Market development: Aston Martin is a leading organisation that has high brand value (Astonmartinlagonda, 2022). Hence, they have a significant scope of market development. This is about entering into a new market with existing products (Kalogiannidis and Mavratzas, 2020,p.121(5)). Hence, Aston Martin can enter into some developing countries like Indonesia, the Czech Republic and many more as here the products of the organisation get high value and appreciation.

Product development: This is about enhancing the products and marketing them into the existing market (Kukartsev et al., 2019, p.3(3)). According to the activities, it can be said that to have growth Aston Martin partially follows this strategy too. This is because they have started using the three-pillar product strategy that addresses the front-engine, mid-engine and SUVs in their existing market (Astonmartinlagonda, 2022).

Diversification: This is about the introduction of modified and new products in the new market (Kalogiannidis and Mavratzas, 2020,p.121(6)). In the case of Aston Martin, they are already working on developing the products so that in order to have significant growth they can enter into new markets with their innovative products that will increase their opportunities to develop a strong larger clientele.

In the Hotel Industry, the chosen organisation is Premier Inn. The use of the growth strategy of the Ansoff matrix has been discussed here on it.

Market penetration: Premier Inn is a leading multinational hotel so they can enhance their growth using significant branding and providing several offers to attract more customers. This way they can significantly enhance their business with existing products in the existing market.

Market development: Premier Inn has strong products and services which has helped them to gain a strong brand reputation (Whitbread, 2022b). Hence, their products and services are their strength so that using this organisation can enter into a new market to have growth. In the post-pandemic situation, hospitality is flourishing so that using this opportunity the organisation can enter into a new market and achieve success.

Product development: The organisation is working on enhancing its product and services. For instance, they have introduced a self-check-in kiosk (Whitbread, 2022a). Moreover, they have enhanced their services regarding sanitisation and maintaining food quality. Hence, these are beneficial for having growth in the existing market with enhanced products and services.

Diversification: This strategy is about entering a new market with a new product (Kukartsev et al., 2019, p.3(3)). Hence, the organisation can enter into a new country including the local cuisine in terms of product innovation so that the organisation can have significant market growth.


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