CA Intermediate · Financial Management and Strategic Management · Strategic Choices
Kaveri Foods, a packaged snacks company, sells only in South India. Without changing its product range, it now plans to enter North and West Indian states with its existing snacks through new distributors. In Ansoff's product-market matrix, this is:
This is market development in Ansoff's matrix. The company sells its existing product, snacks, in new markets, namely North and West Indian states. Market penetration would keep both product and market unchanged, and diversification would change both.
- AMarket penetration
- BProduct development
- CMarket developmentCorrect
- DDiversification
Explanation
The product stays the same (existing snacks) while the market is new (new regions). That combination is market development. Market penetration would mean selling more of the existing product in existing markets.
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