Apple

This approach gives a Apple a diversity of product portfolios across the four quadrants of the BCG matrix. The MP3 market, where Apple is a market leader, is in decline due to sales switching to smart phones instead. Despite this declining market size, the iPod portfolio is still classified as a cash cow for Apple. This is because it remains quite profitable without any real need to continue to support the portfolio to any significant extent. Therefore, at this time, it is a cash generator, whose profits can be reallocated to other parts of the business that offers great potential.

The computer division would be classified as a dog. This means it is operating in a mature market and they are a relatively small player in the market. As a result, the BCG matrix considers this portfolio to provide little long-term potential and the outcome of the matrix guidance would be to limit future investment.

However, as we know, many of Apple’s products are interrelated – as they use the same operating system and rely upon each other’s components – Apple would see their PC division as having strategic value in an overall customer relationship strategy. This means that Apple would adopt a different reinvestment strategy than the one suggested by the BCG matrix due to this strategic outlook.

Their tablet portfolio – the iPad – is currently making the transition from a star to a cash cow. This is happening because the tablet market is maturing and as a result the BCG matrix suggests that less reinvestment will be required in this product portfolio, primarily because market shares and stabilize and the level of competition intensity should reduce. Obviously technology advancements will continue, so Apple will continue to reinvest sufficiently to ensure that there product offerings remain leading edge.