Take a look at your marketing ROI.
Do you like what you see? Or does it feel like no matter how much you spend marketing that one product or service, the return never grows? Maybe you keep missing your target all together.
Whether you manufacture big iron, produce and distribute products for animal health, or work in the crop sciences, if you don’t have a clear picture of who makes up your ideal audience or know where your products and services stand in the market, then your marketing efforts won’t breed the results your company deserves.
The first steps toward marketing your product portfolio more efficiently is knowing who you want to target and putting measures in place that will help you adapt your ideal audience as the market continually evolves.
Just because you’ve always marketed and sold to the same audience doesn’t necessarily mean that’s the best audience for your products. You might be surprised by the who once it’s backed by research and market data – and you might just expand your audience or pivot to find the best places to spend your time, money, and efforts. Intrigued? Let’s dig in.
Start with:
Buyer personas, or the semi-fictional representations of your ideal customers, are based on market research and the data you already have in your existing customer base.
They will serve as the foundation of your inbound marketing strategy by helping you determine where to focus your resources, guiding product development, and fostering company-wide alignment.
With strong, detailed personas in place, you’ll be able to attract the most valuable visitors to your brand.
At its core, marketing segmentation is the practice of splitting up your customer base into smaller, more targeted groups. These subsets are often centered around things like priority level, demographics, or needs and can be used to optimize the marketing of products and services to Ideal Client Profiles (ICPs).
Reaching out to your customers where they are is a fundamental part of inbound marketing in the ag sector—that’s why implementing a multi-channel strategy is so important.
When you use multiple promotional channels (like social media, email, or print advertisements), you’re not only spreading your message far and wide, but you’re also creating multiple “touch points” that keep your company top of mind when your prospects are making buying decisions.
Once you have a firm idea of who and how to connect with your ideal audience, it’s time to consider where your products fit into the equation.
If you want to be able to make even more informed marketing decisions, you’ll need to develop a strategy to analyze your product portfolio and determine where you are making money, where you need to spend money, and where you can disrupt the market with something new.
That’s where the BCG matrix comes in.
Created by the Boston Consulting Group in the early 1970s, the BCG matrix is a marketing and sales tool that helps corporate businesses strategically visualize their product portfolios.
The BCG matrix helps companies gain insight on which products to invest in, develop further, or discontinue by introducing a long-term strategy for analyzing products based on two primary factors:
Market Growth. The number of buyers a particular product or service has in the market.
Relative Market Share. The amount of space a product or service holds within the market.
The BCG matrix is divided into four quadrants: stars, cash cows, question marks, and dogs.
Let’s break it down.
You might have noticed that there’s a correlation between the BCG matrix and a product’s lifecycle stage.
Most products will begin their lifecycle as a question mark. If these products are able to maintain their category leadership as their market grows, then they become stars. Over time, the market is likely to slow, morphing stars into cash cows. Finally, as a product enters the twilight of its life and sales growth declines or flatlines altogether, cash cows could become dogs.
Of course, it’s important to note that the correlation between the BCG matrix and product lifecycle isn’t a guarantee. Question marks could take a turn for the worse, bypass the middle stages, and go straight to the doghouse (they are the problem child, after all).
So, now that you understand what a BCG matrix is, why does it matter? How will taking the time to analyze and plot your product portfolio help you target your ideal buyers?
In the words of Bruce Henderson, the brain behind the Boston Consulting Group matrix:
Every company needs products in which to invest cash. Every company needs products that generate cash. And every product should eventually be a cash generator; otherwise it is worthless. Only a diversified company with a balanced portfolio can use its strengths to truly capitalize on its growth opportunities.
Now, let’s put it all into perspective.
Let’s pretend that I own my own lawn equipment manufacturing company—Murphy’s Mowers. I take a good look at my portfolio and determine where each of my products fit into the BCG matrix.
Now that I know where each of my products stand in the market, I can pair this data with the information I have curated about my target audience and formulate a well-educated strategy to make the most out of my marketing budget.
See how it all comes together?
Ready to stop spinning your marketing tractor wheels in the mud and start marketing your products more efficiently? Analyzing and plotting your product portfolio on the BCG matrix is a step in the right direction!
Please note: The BCG matrix is only recommended for large and corporate-level companies. With small to medium-sized companies, the relative market share is often too small to quantify, making it difficult to properly classify products.
Click the form on the right to download our easy-to-use worksheet to start categorizing each of your products within the BCG matrix.