The Boston Consulting group’s product portfolio matrix (BCG matrix) is designed to help with long-term strategic planning, to help a business consider growth opportunities by reviewing its portfolio of products to decide where to invest, to discontinue, or develop products. It's also known as the Growth/Share Matrix.
The BCG Matrix categorizes products or services into four different quadrants based on two criteria: market growth rate and market share. Market growth rate refers to the rate at which the market for a product or service is growing, while market share refers to the percentage of the market that a company or product holds.
Developed in 1968 by Boston Consulting Group (BCG) this tool for product portfolio analysis still has relevance today.
The growth share matrix is, put simply, a portfolio management framework that helps companies decide how to prioritize their different businesses. — BCG
The horizontal axis describes relative market share, the vertical axis shows market growth rate.
You’ll want to retain and further develop your stars. After all, they already have a big market share and there’s even more potential for the market to grow. There is still lots of profit to be made even though the market and product have already proven themselves.
You need to make significant investments for your Star products to retain their star status and market position. Various factors will influence how you do this in practice.
⚡️ User Experience Tip
If you have a star product but the technology is outdated, you’re probably considering replacing that technology. So if you’re going to make that investment anyway, why not take the opportunity to improve the product interface right away? That will keep you ahead of challengers and raise the barriers to entry for new players.
A product redesign is the solution you’re looking for here.
⚡️ Value Driven Tip
Your product is in the star quadrant of the BCG matrix because it adds value for customers and users. Review your sales channels to check for stakeholders who could help you grow your market share. Maybe your product is the perfect fit for a big consultancy firm’s services? If so, find out precisely what made them choose your product, then create opportunities for product developments that add value for these types of partners or resellers.