And the Driver Is… Bill Gates!

If a company has the resources and ability, then it makes sense to branch out. The key is to determine if your resources (staff, skills, money) are sufficient to handle the expansion. For our business, (which makes a small digital memory card case called the iPorter) we can't add another product let alone business, until we are generating more cash flow.

If a company has resources and talent at its diposal,in the present day ,it must diverisfy to sustain its existance.The market is getting tough and the consumers are one step ahead as they have lot of options to choose from.Usability and acceptability is the main area of concern and simple marketing will not do.It has to be accetable in order to remain in the market.

In the case of how Microsoft enters new markets and creates new products, it bears noting that they use money from a cash cow "windows" to fund other endeavors, BUT, they have never finished fixing, or rebuilding the cash cow, instead taking away jobs and wiping out new companies by cornering a new market, rather than cleaning up the mess they made in the OS. I think it is a disgrace and a farce to let MSFT "wallow" into new business areas when they are obviously inept in the one market that matters most, their OS being unreliable and insecure. That a consumer would pay for an idea from Bill Gates when he has shown himself unreliable in the other areas astounds me, there apparently is no end to lack of stupidity of the average computer buyer, who gives their good money for half-baked MSFT technology, and then looks forward to the next bastardized service, system, or market Microsoft announces. I guess thats what suckers are for, and that is who Bill Gates sells products to, there is a sucker born evey minute, and Bill is just smart enough to know that much.

No, large companies that consume the marketplace in any one industry should stay where they are. As the largest companies enter into industry after industry under expansion programs, they make it harder and harder for small busninesses to start up. This economy is build on small business, personal wealth is built on small businesses and independent action. The large companies use lobbists and any means needed to kill the little guy, even though they are not considered to be monopolies, they damage the local and naational economies.
Instead, The profits should be paid to the stock holders and then as the stockholders see fit, they can diversify thier holdings in any industry they chose.
This will shrink the middle management positions ( a useless one anyway ) to a point where small business will begin to break out and create new trends that are truely consumer driven rather than driven by the corporate statment telling the consumer what they want.
I want a larger simpler cell phone, and I am not alone.

FOCUS, FOCUS, FOCUS

But on what?

to answer that, ask yourself
Is there a basic problem that you can solve for your current customers?
Would your customers expect "YOU" to solve that problem?

To do that, you have to figure out what your brand is all about! Once you have that done, you'll know how to extend your brand.

If you are selling a product, you could sell services around that product and solve customer problems. If you're selling services, you could package some of them together to productise your services. Perhaps there is an activity pretty near your activity - in the client's mind. You could try and explore that activity, start with services and then products.

Chasing new industries in the hope of growth is usually unsuccessful, if your brand does not travel to that industry. I doubt Boeing would try to make cars, or even car components. The brand doesn't travel to automobiles. But it may travel to a select niche - high performance racing cars.

Let brand extension and customer value & perception analysis principles guide your decisions on expansion into new industries.

Hope this helps