Market Development Matrix

The Market Development Matrix is a 2x2 matrix used to analyze the potential of existing and new markets. It helps to identify the most profitable markets and the best strategies to enter them.

At a very high level, the Market Development Matrix is used in the context of business, marketing, finance.

Market Development Matrix quadrant descriptions, including examples
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What is the Market Development Matrix?

A visual explanation is shown in the image above. The Market Development Matrix can be described as a matrix with the following quadrants:

  1. Existing Markets: New Products: Introducing new products to existing markets, e.g. introducing a new flavor of a popular product
  2. Existing Markets: Existing Products: Selling existing products to existing markets, e.g. offering discounts on existing products
  3. New Markets: New Products: Introducing new products to new markets, e.g. launching a new product in a foreign market
  4. New Markets: Existing Products: Selling existing products to new markets, e.g. selling existing products in a foreign market

What is the purpose of the Market Development Matrix?

The Market Development Matrix is a 2x2 matrix used to analyze the potential of existing and new markets. It helps to identify the most profitable markets and the best strategies to enter them. The matrix is divided into four quadrants, each representing a different market development strategy.

The top-left quadrant is labeled 'Existing Markets: New Products'. This quadrant represents the strategy of introducing new products to existing markets. This is the most common strategy and is often used when a company has an existing customer base and wants to expand its product offerings. An example of this strategy is introducing a new flavor of a popular product.

The top-right quadrant is labeled 'Existing Markets: Existing Products'. This quadrant represents the strategy of selling existing products to existing markets. This is the most cost-effective strategy and is often used when a company has an existing customer base and wants to increase sales of existing products. An example of this strategy is offering discounts on existing products.

The bottom-left quadrant is labeled 'New Markets: New Products'. This quadrant represents the strategy of introducing new products to new markets. This is the most risky strategy and is often used when a company wants to enter a new market and needs to create demand for its products. An example of this strategy is launching a new product in a foreign market.

The bottom-right quadrant is labeled 'New Markets: Existing Products'. This quadrant represents the strategy of selling existing products to new markets. This is the least risky strategy and is often used when a company wants to enter a new market but does not have the resources to create demand for its products. An example of this strategy is selling existing products in a foreign market.


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What templates are related to Market Development Matrix?

The following templates can also be categorized as business, marketing, finance and are therefore related to Market Development Matrix: AIDA Marketing Matrix, Affiliate Marketing Matrix, Agile Capability-Value Alignment Matrix, Agile Scaling Matrix, Ansoff Matrix, Asset Allocation Matrix, BCG Matrix, Brand Affinity Matrix. You can browse them using the menu above.

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