What is market attractiveness matrix?

What is market attractiveness matrix?

This matrix combines two dimensions: industry attractiveness and the competitive strength of a business unit into a matrix. Correspondingly, a business can direct its business units. It can then determine where to invest, to hold their position, harvest or divest.

What are market attractiveness factors?

A measure of the opportunities a market offers to an organisation, with an acknowledgment of various factors within the market, including growth rate and market size, as well as outside factors such as access to raw materials, competition and industry capacity.

How do you assess the attractiveness of a market?

The 10 Ways to Evaluate a Market is a checklist that’s helpful in identifying the overall attractiveness of a new market: urgency, market size, pricing potential, cost of customer acquisition, cost of value delivery, uniqueness of offer, speed to market, up-front investment, up-sell potential, and evergreen potential.

What is a 9 Cell industry Attractiveness business Strength Matrix?

The GE matrix was developed by Mckinsey and Company consultancy group in the 1970s. The nine cell grid measures business unit strength against industry attractiveness and this is the key difference. Whereas BCG is limited to products, business units can be products, whole product lines, a service or even a brand.

What do you mean by GE model?

The GE / McKinsey matrix is a model used to assess the strength of a strategic business unit (SBU) of a corporation. It analyzes market attractiveness and competitive strength to determine the overall strength of a SBU. The Y-axis measures market attractiveness based on a high, medium, or low score.

What is industry attractiveness?

Industry Attractiveness is the (relative) future profit potential of a market. In general it can be determined using the Five-Forces Framework as described by Michael Porter in his books Competitive Strategy and Competitive Advantage.

What is industry attractiveness analysis?

How is the attractiveness of a market or an industry measured?

Market attractiveness is a measure of the potential value of a particular market. Ways in which attractiveness may be measured include: Growth rate of market. Size of market after growth.

What is the market attractiveness?

the degree to which a market offers opportunities to an organisation, taking into account the market size and growth rate and the level of competition and other constraints.

How do you use McKinsey Matrix?

HOW TO APPLY THE MATRIX TO YOUR BUSINESS

1. Step 1: Determine Industry Attractiveness of Different Business Units.
2. Step 2: Determine the Competitive Strength of each Business Unit.
3. Step 3: Plot the business units on a matrix.
4. Step 4: Analysis of Information.
5. Step 5: Identify future direction of each unit.

What is GE model in marketing?

How to determine the attractiveness of a market?

Although any assessment of market attractiveness is necessarily subjective, just use your knowledge and best judgment. The following key factors may also help determine attractiveness: Market size. Market growth. Pricing trends. Intensity of the competition. Overall risk in the industry.

How is the market attractiveness framework used in strategic planning?

A widely used tool for conducting a portfolio analysis is the Market Attractiveness Framework, which provides a structure that works with your products and services as listed in the previous section. The framework looks at your portfolio based on the strengths of each product or service and its market attractiveness.

How are SBUs competitive strength and market attractiveness determined?

The matrix comprises two axes. The competitive strength of the individual SBUs is represented on the x-axis, while market attractiveness is represented on the y-axis. Both competitive strength and market attractiveness are determined by a weighted score calculated from the relevant factors that apply to each.

What is the GE matrix and McKinsey matrix?

The GE matrix / McKinsey matrix (MKM) is a model to perform a business portfolio analysis on the Strategic Business Units of a corporation. A business portfolio is the collection of Strategic Business Units that make up a corporation.