Customer's reaction to a product. What's it: The Ansoff matrix shows you four marketing strategies available based on product and target market considerations. Diversification is one of the four main strategies that have been indicated by the Ansoff matrix, where Ansoff indicates two key factors for marketing, which are the products that are sold and to whom it is sold (Ansoff, 1957; Ansoff, 1958). Intensive Growth Strategies - Ansoff Matrix - Product-Market Grid What is clear with Ansoff's Matrix is the incremental increase in risk offered by the five strategies, due to the growing cost with each step beyond market penetration and uncertainty of operating in new markets and industries: Going back to the example of Coca-Cola, the firm's emphasis on market penetration and other non-diversification . Ansoff Matrix: How to Use for Business Growth It is used to evaluate opportunities for companies to increase their sales through showing alternative combinations for new markets (i.e. These are market penetration, product development, market development and diversification. Diversification is one of the four alternative growth strategies in the Ansoff Matrix. Diversification is the most risky since a company starts entering a completely new and unfamiliar market with a new and unfamiliar product. Definition of Ansoff Matrix. At the business unit level, diversification . Start studying ansoff matrix. Diversification scenario. Designed by H. Igor Ansoff, the Ansoff Matrix is composed of 4 strategies: Market penetration, product development, market development and diversification. Using the Ansoff Matrix to Plan Market Strategy - Lucidchart Using The Ansoff Matrix To Plan Market Penetration Wide application. Market Penetration. Ansoff's matrix is a very useful tool for identifying and classifying the range of strategic options available to a firm and thus is used in the "strategic choice" part of the . The Ansoff matrix itself was later developed - see Reference 1. Diversification is considered the riskiest as it involves simultaneous efforts on both, the product and the market development.