Market Share

A business with a range of products has a portfolio of products. However, owning a product portfolio poses a problem for a business. It must decide how to allocate investment (e.g. in product development, promotion) across the portfolio.

A portfolio of products can be analysed using the Boston Group Consulting Matrix. This categorises the products into one of four different areas, based on:

Market share – does the product being sold have a low or high market share?

Market growth – are the numbers of potential customers in the market growing or not?

How does the Boston Matrix work? The four categories can be described as follows:

Stars are high growth products competing in markets where they are strong compared with the competition. Often Stars need heavy investment to sustain growth. Eventually growth will slow and, assuming they keep their market share, Stars will become Cash Cows

Cash cows are low-growth products with a high market share. These are mature, successful products with relatively little need for investment. They need to be