{"id":9582,"date":"2026-10-20T07:00:00","date_gmt":"2026-10-20T05:00:00","guid":{"rendered":"https:\/\/lalonja.tech\/?p=9582"},"modified":"2026-10-14T11:37:48","modified_gmt":"2026-10-14T09:37:48","slug":"bcg-matrix-what-is-it-and-how-can-it-help-your-business","status":"publish","type":"post","link":"https:\/\/www.lalonja.tech\/en\/bcg-matrix-what-is-it-and-how-can-it-help-your-business\/","title":{"rendered":"BCG Matrix: What is it and how can it help your business?"},"content":{"rendered":"\n<p>If you have a business with a diverse catalog of products or services, knowing which ones perform best can increase your revenue and reduce your losses. After all, what is the point of keeping a product that doesn't generate profit? To avoid this, many entrepreneurs and companies use the BCG matrix. If you don't know what it is yet, we'll tell you all about it in this article.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What is the BCG Matrix<\/h2>\n\n\n\n<p>In 1970, Bruce Henderson, founder of the Boston Consulting Group, created what we know today as the BCG matrix. These acronyms correspond to the name of his company. Henderson developed this tool to analyze his company's portfolio. Over time, it evolved and improved, becoming a matrix used by numerous companies.<\/p>\n\n\n\n<p>The BCG matrix, or growth-share matrix, evaluates a company's products based on their market share and growth rate. This analysis allows you to understand the lifecycle of your products, detect which ones are less profitable, and identify what sales strategies you can follow to grow. Ultimately, it is used to:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Allocate resources efficiently<\/strong>. Your company can strategically allocate its resources to high-growth potential products, achieving better sales.<\/li>\n\n\n\n<li><strong>Prioritize product portfolio <\/strong>by identifying what works and what doesn't. It allows you to have a clear view of your products' performance and make informed decisions.<\/li>\n\n\n\n<li><strong>Foster innovation<\/strong>. The BCG matrix allows you to develop innovations for high-potential products.<\/li>\n\n\n\n<li><strong>Plan long term.<\/strong> By classifying products according to performance, you can better plan your strategy.<\/li>\n<\/ul>\n\n\n\n<p>On the other hand, it\u2019s important to keep in mind that this tool has certain limitations. This matrix involves a simplification that can be excessive, causing some products not to fit into any category. Furthermore, its analysis is limited to two variables, leaving out other relevant factors. This means it shouldn\u2019t be the sole source on which to base your decisions; instead, you should combine it with others such as a SWOT analysis.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Build your own BCG matrix<\/h2>\n\n\n\n<p>Surely now you are wondering how you can create your own BCG matrix. It\u2019s a simple process, but with a series of elements that are worth understanding well.<\/p>\n\n\n\n<p>The BCG matrix is structured around two perpendicular axes that give rise to four quadrants. In them, a company's products or business units are placed based on two variables: their market growth rate and their relative market share.<\/p>\n\n\n\n<p>The vertical axis represents the growth rate of the market in which your product competes, while the horizontal axis represents its relative share compared to the competition. On the other hand, the quadrants receive a characteristic name and representation:<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>Star product.<\/strong> They are market leaders. They generate significant revenue for you but, in turn, require considerable investments. They combine high growth with a high market share. These are products that are in the growth phase.<\/li>\n\n\n\n<li><strong>Cash cow product<\/strong>. It is characterized by a low market growth rate and a high relative share. These are established products that generate steady income and require less investment than star products. The resources they generate can be used to fund other products or business units with higher growth potential. They usually correspond to the maturity phase.<\/li>\n\n\n\n<li><strong>Dog product<\/strong>. They are no longer profitable for your company. They have a low growth rate and a low market share. They barely generate profits and can consume resources that could be allocated to other areas. They are at the end of their lifecycle, do not sell, and do not bring in income.<\/li>\n\n\n\n<li><strong>Question mark product<\/strong>. They have just been launched and are innovative. They have high growth potential, but low market share. Therefore, they are products in the launch stage. They require analysis to see if it is worth investing to increase their share.<\/li>\n<\/ol>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"640\" src=\"\/wp-content\/uploads\/2026\/10\/20260921-APH001-BCG-MATRIX-1024x640.png\" alt=\"\" class=\"wp-image-9583\" srcset=\"\/wp-content\/uploads\/2026\/10\/20260921-APH001-BCG-MATRIX-1024x640.png 1024w, \/wp-content\/uploads\/2026\/10\/20260921-APH001-BCG-MATRIX-300x188.png 300w, \/wp-content\/uploads\/2026\/10\/20260921-APH001-BCG-MATRIX-768x480.png 768w, \/wp-content\/uploads\/2026\/10\/20260921-APH001-BCG-MATRIX-1536x960.png 1536w, \/wp-content\/uploads\/2026\/10\/20260921-APH001-BCG-MATRIX-2048x1280.png 2048w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p><\/p>\n\n\n\n<p>Now that we know the elements that form this matrix, we can move on to see the steps to build it:<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li>Choose the business units or products in your portfolio that you want to analyze.<\/li>\n\n\n\n<li>Identify the reference market where each product competes.<\/li>\n\n\n\n<li>Calculate the market growth rate. To do this, you can use statistical data, industry reports, market trends, and growth projections. This allows you to know whether each product operates in a high- or low-growth market.<\/li>\n\n\n\n<li>Analyze market share. You can calculate a product's market share by dividing its sales by total market sales during the same period and multiplying the result by 100. However, for the BCG matrix it is also common to use relative market share, which compares the company's share with that of its main competitor.<\/li>\n\n\n\n<li>Place each product in the matrix using the collected information to assign the corresponding position according to its growth rate and share.<\/li>\n<\/ol>\n\n\n\n<p>With the matrix built, you can move on to analyzing the results and seeing what decisions you will make. There are usually several strategies derived from this analysis:<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>Build<\/strong>. You increase investment in a product to improve its market share. This is done when there is potential to gain position in a growing market.<\/li>\n\n\n\n<li><strong>Hold<\/strong>. You preserve the product's market position through sufficient investment to maintain its share. This is usually done with cash cow products.<\/li>\n\n\n\n<li><strong>Harvest<\/strong>. You reduce investment to optimize a product's profitability. It seeks to harvest as much as possible in a short time.<\/li>\n\n\n\n<li><strong>Divest<\/strong>. You eliminate products that no longer work and allocate resources to others that perform better.<\/li>\n<\/ol>\n\n\n\n<p>Now you have everything you need to build your BCG matrix. What are you waiting for?<\/p>\n","protected":false},"excerpt":{"rendered":"<p>If you have a business with a diverse catalog of products or services, knowing which ones perform best can increase your revenue and reduce your losses. After all, what is [&hellip;]<\/p>\n","protected":false},"author":6,"featured_media":9579,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[112],"tags":[],"class_list":["post-9582","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>BCG Matrix: What is it and how can it help your business? | La Lonja<\/title>\n<meta name=\"description\" content=\"Do you know which products in your catalog perform best? To find out, many companies use the BCG matrix. 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