Get to know the BCG Matrix and the Dog Product

The BCG matrix, also known as the growth-share matrix, is a strategic analysis tool that helps companies make decisions about how to allocate resources across their different product lines. In this article, we will explore in detail what the BCG matrix is and how it is used to evaluate product performance, focusing especially on the dog product category.

What is the BCG Matrix?

The BCG matrix was developed by management consultancy Boston Consulting Group in the 1970s. It is intended to help companies visualize and evaluate their product portfolio based on their market share and growth rate. It consists of a graph with four quadrants, each representing a different product category: star, cash cow, question mark and dog.

• Stars: Star products are those that have a high market share and high growth. They are growth drivers for the company and require substantial investment to maintain their success. Examples of star products may be the latest technological launches or new market trends.

• Dairy cattle: Cash cow products are those that have a high market share, but low growth. They are stable and profitable products that generate constant cash flow for the company. They usually require less investment to maintain and may be products that have already been positioned in the market for a long time.

• QuestionsQuestion mark products, also known as unknowns or questions, are those that have a low market share but high growth. They represent potential opportunities to become stars or they may be products that do not achieve the expected success and will become dogs. They require significant investment to grow and succeed.

• Dogs: Dog products have low market share and low growth. They do not generate enough cash flow to maintain their viability and can be considered as a liability for the company. They are usually obsolete, declining or low-demand products.

The Dog Product

Within the BCG matrix, the dog product is one that has a low market share and low growth. These products usually generate little revenue and can be considered a waste of time and resources for the company.

The dog category can emerge for a number of reasons, such as lack of demand, product obsolescence, or strong competition in the market. It is important for companies to quickly identify dog products and make strategic decisions about them.

Some actions that companies can consider for dog products are:

1. Discontinue: The company may decide to stop producing and marketing the dog product. This frees up resources that can be allocated to products with greater growth potential.

2. Repositioning: If the dog product has some unique feature or attribute, the company may try to reposition it in the market to attract a new customer segment. This may require a review of marketing, pricing, or distribution strategies.

3. Get rid of:If the dog product has no chance of success, the company may decide to get rid of it by selling it to another company or discontinuing it altogether.

In conclusion, the BCG matrix is a valuable tool for companies when evaluating their product portfolio and making strategic decisions. The dog product, in particular, represents a low-profit product category and it is important for companies to take quick and effective actions to optimize their resources. Identifying, analyzing and properly managing dog products can be key to business success and growth.

Frequent questions

1. What is the difference between a star product and a dog product?
A star product has high market share and high growth, while a dog product has low market share and low growth.

2. What is the objective of the BCG matrix?
The objective of the BCG matrix is to evaluate product performance and help companies strategically allocate resources across their product portfolio.

3. When should you consider discontinuing a dog product?
Discontinuing a dog product should be considered when it does not generate enough revenue and becomes a burden on the company in terms of time and resources.

4. Are there other models for product portfolio analysis?
Yes, in addition to the BCG matrix, there are other product portfolio analysis models, such as the GE-McKinsey matrix and the ADL matrix. Each model has its own characteristics and approaches.