What is market share in BCG matrix?

Structure of the BCG Matrix The matrix is a 2 x 2 quadrant a column heading Market Share and row heading Market Growth Rate. Market share compares the SBUs sales in the current year versus those of competitors. The market growth rate is this years industry sales minus the past years industry sales.

What is market share and market growth in BCG matrix?

The BCG growth-share matrix is a tool used internally by management to assess the current state of value of a firm’s units or product lines. The growth-share matrix aids the company in deciding which products or units to either keep, sell, or invest more in.

How do you calculate the market share of a BCG matrix?

Relative market share can be calculated in terms of revenues or market share. It is calculated by dividing your own brand’s market share (revenues) by the market share (or revenues) of your largest competitor in that industry.

How to calculate relative market share in BCG matrix?

The Managing Director and Senior Partner of BCG, Reeves Martin, quotes about 50 years since its launch that the BCG matrix model will continue to be a valued tool for companies to understand their potential. The market share of a company refers to the identified market percentage it controls.

How does the BCG matrix measure competitiveness?

By using relative market share, it helps measure a company’s competitiveness. The vertical axis of the BCG Matrix represents the growth rate of a product and its potential to grow in the particular market. In addition, there are four quadrants in the BCG Matrix: Question marks: Products with high market growth and a low market share.

What does BCG mean in a marketing strategy?

Cash cows: Products in low growth markets with high market share BCG Modelling is not a new phenomenon, but in the changing digital landscape, its meaning for and application to your marketing strategy will continue to develop.

What makes a company a ” cash cow ” in the BCG matrix?

Cash cows: Products with low market growth but a high market share. The assumption in the matrix is that an increase in relative market share will result in increased cash flow. A firm benefits from utilizing economies of scale and gains a cost advantage relative to competitors.