A Brief Overview Of Portfolio Strategy

The marketing strategies define how a campaign will achieve the business objectives of your company. This requires identifying and prioritizing those products with greater potential and profitability, select the public you will lead, define brand positioning you want to achieve in the minds of customers and work strategically different variables form the marketing mix (product, price, distribution, and communication).

Portfolio strategy

Not all products of your portfolio have the same profitability, nor the same potential. That is why you need to make strategic decisions about your product portfolio. Thus you prioritize investment of resources depending on the importance of achieving these marketing goals you have set.

To make strategic decisions about product portfolio is the right way to start working with your marketing strategies.You can use the McKinsey-General Electric matrix also called attractive-competitiveness matrix. First and depending on some products that you have in your portfolio, you must decide whether you will work for products on an individual basis, grouped by product line or your portfolio is so broad that you must work dividing by business units.

McKinsey matrix is formed by two axes. On the X axis are the “competitive position” while the Y axis is located at the “market appeal.” In the axis of “competitive standing,” you must assess the ability of your product to compete against other options available in the market and classify it in one of its three quadrants: weak, medium or strong. Moreover, the hub of “market attractiveness” as the name suggests, analyze the attractiveness of the market in which the product operates, later also sort the result in one of its three quadrants: low, medium or high.

Three areas correspond to three marketing strategies portfolio:

Invest/Grow: This field of the matrix has the absolute priority when allocating your resources. When making your investment will result in rapid growth, you need to allocate the maximum amount of your investment in this area.

Select/Benefits: This field can be reversed, but attention should be given depending on the analysis of each case. If you have finally decided to invest, there are two strategies: First is invest only in maintaining the current situation. Second is spend a greater amount of your budget item if there is a good probability that there is growth potential.

Harvest/Divest: it is advised to observe this area in the short term, disinvestment, take profits and try to sell to remove the stock.

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