Classroom Activity: "BCG Matrix in Action"

Activity Title: "Place the Product!"

Objective:
Students will categorize real-world products using the BCG Matrix and justify their decisions.

Step 1: Warm-Up Discussion (10 minutes)

Ask students:

• Can you name a product that is very successful right now? (Possible Stars)

• What products make a company a lot of money but don’t really grow? (Possible Cash Cows)

• What new products are a bit of a risk? (Possible Question Marks)

• What products have disappeared over time? (Possible Dogs)

Write their ideas on the board and introduce the BCG Matrix model.

Step 2: Group Task – Product Sorting (20-30 minutes)

1. Divide students into small groups (3-4 students per group).

2. Give each group 6-8 product case cards (or let them research).

   • Examples: iPhones, Smartwatches, Streaming Services, McDonald's Big Mac, Tesla Model 3, DVDs, Electric Scooters, Coca-Cola, Nintendo Switch, AI Chatbots

3. Each group must place each product into one of the four quadrants of the BCG Matrix.

4. For each decision, they must justify:

   • Why does it belong in this category?

   • What strategy should the company take? (Invest, Milk, Drop, etc.)

Step 3: Class Discussion & Debate (15 minutes)

• Groups present their findings and explain their choices.

• Classmates can challenge placements with counterarguments.

• Final discussion: Can a product move between categories? (e.g., Can a Question Mark become a Star or a Dog?)

Step 4: Reflection & Application (10 minutes)

Ask students:

• How do companies use this tool in real life?

• Why is it important for businesses to have a mix of Stars, Cash Cows, and Question Marks?

• If you were a business owner, how would you use the BCG Matrix to make decisions?

Extension Activity: BCG Matrix Business Plan

• Students create their own company and assign at least 4 products to the BCG Matrix.

• They present a strategy for each product.

What you should know 

By the end of this subtopic, you should be able to:

• apply the Boston Consulting Group matrix in a given context (AO2)

https://quizlet.com/pa/821928059/41-bcg-matrix-flash-cards/?i=4jrhob&x=1jqt 

BCG Matrix

A matrix that classifies the products of a business into high and low market share and market growth categories.

BCG Matrix: Dogs

Low growth, low market share, should be gotten rid of. These products may be at the end of their product life cycle or perhaps they are niche products competing in mature low-growth markets.

BCG Matrix: Cash Cows

High Market Share, Low Margins. Cash cows are successful products in mature, slower-growing markets. They earn high sales revenue from an established customer base. Customer loyalty is likely to be high. Therefore, less money is needed for marketing. Promotion is likely to focus on replacement products and maintaining loyalty.

BCG Matrix: Problem Child

Low Market Share, High Market Growth. high cash needs that, if nurtured properly, can convert into stars. (also known as ‘question marks’) have low market share but operate in high growth markets. These products are often recently launched in response to the rapidly growing revenues of competitors. In the streaming market, Amazon’s Prime or Hulu can be considered in this category. If they are to gain market share, considerable investment will be required. Therefore, they are likely to have a negative cash flow.

BCG Matrix: Stars

High Market Share, High Growth. Stars are products that have a high market share in growing markets. Revenues should be growing strongly. Netflix can be considered a star product, as it is the market leader in the rapidly growing streaming market. This type of product also requires significant investment to sustain growth. Marketing will focus on attracting new customers and establishing a brand image. Profitability will depend on how much its revenue is reinvested in future growth. Certainly, high growth businesses will be spending heavily to keep expanding their operations and sales. Therefore, it is possible for a star to have a negative cash flow.

✅ Businesses use the BCG Matrix to manage product portfolios.

✅ Stars require investment, Cash Cows fund growth, Question Marks are risks, and Dogs should be retired.

✅ A good business strategy aims to turn Stars into Cash Cows before they lose growth potential. 

4.1 BCG Matrix Case Study Questions

https://drive.google.com/file/d/14M6PLa40LXwJK4UE3pCmsFD4S53M-hbd/view?usp=sharing 

4.1 BCG Matrix Case Study Answers

https://drive.google.com/file/d/11mmFC7x3JAHdV9icLlt3bRv7GuUzG8Js/view?usp=sharing 

Answers 

(a)  Define the term Boston Consulting Group matrix.    [2 marks] 

The BCG matrix is a management planning and decision-making tool used to examine the product portfolio of a business. It does this by analysing the sales and/or market share for each product in its portfolio and determining whether there is high or low market growth in the market. 

Award [1 mark] for a limited response that shows some understanding. Award [2 marks] for a clear and accurate definition, similar to the example above. 

(b)  Explain the use of the BCG matrix for managers and decision makers in an organization.    [4 marks] 

Possible answers could include an explanation of: 

• The BCG matrix can be useful for a business trying to manage a diverse range of products in its portfolio. It is a tool for devising and implementing effective product portfolio management. 

• Product portfolio management can be used to maximize the profitability of an organization’s product range and product mix. For example, it helps to provide balance in a firm’s product portfolio as different products go through their product life cycle at a different pace. 

• It can help improve financial planning and financial management at the business. For example, an organization that has too many dogs in its product portfolio will experience cash flow problems. 

• Accept any other relevant use that is fully explained. 

Award [1 – 2 marks] for a limited response that shows some understanding of the demands of the question. 

Award [3 – 4 marks] for a clear and accurate answer that shows good understanding of the demands of the question. There is appropriate use of terminology throughout the response. 

(c)  Explain the link between the products in a firm’s BCG matrix and their product life cycle.   [4 marks] 

The explanation should refer to the four quadrants in the BCG matrix and their stage in the typical product life cycle: 

• Question marks = Launch stage (phase) 

• Stars = Growth stage 

• Cash cows = Maturity stage 

• Dogs = Decline stage 

Award [1 – 2 marks] for a limited response that shows some understanding of the demands of the question. 

Award [3 – 4 marks] for a clear and accurate answer that shows good understanding of the demands of the question. There is appropriate use of terminology throughout the response.