Ansoff matrix example

What it shows

The Ansoff matrix (Ansoff 1957): existing or new products crossed with existing or new markets, giving market penetration, product development, market development and diversification.

Each cell gives what the strategy does, its relative risk and one growth option for Northfield Coffee Roasters, the fictional specialty roaster used across this set of business frameworks.

How to read it

1. 1

   Market penetration sells existing products in existing markets, here by winning cafe accounts from rival roasters in Northfield’s home region. It carries the lowest risk.

2. 2

   Product development brings new products to existing markets: a cold brew concentrate, launched this year, for its cafes and subscribers. It carries moderate risk.

3. 3

   Market development takes existing products to new markets, such as selling its blends to offices and hotels. It also carries moderate risk.

4. 4

   Diversification, a new product in a new market, would be a barista training school for hospitality staff. It carries the highest risk.

The four strategies

• Market penetration: sell more of current products in current markets; lowest risk.
• Product development: create new products for current markets; moderate risk.
• Market development: take current products into new markets; moderate risk.
• Diversification: enter new markets with new products; highest risk.

Ways to use it in teaching

• Fill the four cells for a company in the news, then rank the options by risk and justify the order.

• Is the barista school really a new product in a new market? The value chain example shows Northfield already training its own baristas and showing its customer cafes’ baristas how to brew. How students read “new” decides whether the school counts as diversification at all, a common critique of the matrix.

• Follow the cold brew concentrate across the set: product development here, a question mark on the BCG matrix, the project on the stakeholder grid and the task of Tuckman’s team. Ask what each framework adds that the others leave out.

Sources

• Ansoff, H. I. (1957). Strategies for diversification. Harvard Business Review, 35(5), 113–124.
• Ansoff matrix. (n.d.). In Wikipedia. Retrieved October 19, 2026, from https://en.wikipedia.org/wiki/Ansoff_matrix