Target segments Multiple market
segmentsCustomersValueValueCorporation
CostCompetitorsProduct/sevice
differentiationThe basics of marketing strategy 59
has never presented significant systematic
evidence to support his own assertion (cf.
Wensley, 1994).
The four contexts
The four boxes (contexts) relate to the market
share/market growth matrix originally devel-
oped by the Boston Consulting Group (BCG)
under Bruce Henderson. Although there have
inevitably been a whole range of different
matrix frameworks which have emerged since
the early days, the BCG one remains an
outstanding exemplar not only because of its
widespread popularity and impact (nowadays
even University vice-chancellors have been
heard to use terms such as ‘cash cow’), but
because there was an underlying basic eco-
nomic logic in its development. Many other
similar frameworks just adopted the rather
tautologous proposition that one should invest
in domains which were both attractive and
where one had comparative advantage!
The market growth/market share matrix,
however, still involved a set of key assump-
tions which were certainly contestable. In
particular, alongside the relatively uncontro-
versial one that in general the growth rate in
markets tends to decline, there were the
assumptions that it was in some sense both
easier to gain market share in higher growth
rate markets, and also that the returns to such
gains were likely to be of longer duration.
This issue can be seen as assumptions
about first the cost and then the benefit of
investment in market share, and has been
discussed and debated widely in marketing
over the last 20 years (see Jacobson and Aaker,
1985; Jacobson, 1994). The general conclusions
would appear to be that:(i) market share as an investment is not on
average under-priced, and may well be
over-priced;
(ii) the cost of gaining market share is less
related to the market growth rate andFigure 4.3 The strategic triangle
Source: Ohmae (1982, p. 92)