Assuring continual business growth for your tutoring agency can often be a challenge. Perhaps the most difficult challenge of growing your tutoring business is figuring out where to invest.
Alongside regularly keeping an eye on KPIs and general analytics, you can choose to use certain business models to help aid strategic growth. One of the most common models used by businesses of all sizes around the world is the Boston Consulting Group Matrix (BCG Matrix), also known as the Growth/Share Matrix.
We created a short video explaining the BCG Matrix. The video also gives you a few examples of how this model can be applied to your tutoring company.
What is the BCG Matrix?
The BCG Matrix is a simple, but effective business model used to segment your products and services into 4 key categories. These are: dogs, questions marks, stars and cash cows.
The BCG Matrix can be applied to any business. So whether you are an online tutoring agency or provide in-person tutoring services, you will be able to segment your business with this model.
Let's take a closer look at the 4 segments of the matrix:
These are low growth and low market share products. Within your tutoring business this could be a subject which clients won’t pay much for, but there are lots of qualified tutors outside of your business looking to teach it.
Business advisors will suggest that you try to rid your business of dog products and services.
2. Question Marks
Sometimes also know as Problem Child products. These are fast growing products or services but you have a low market share.
Let's examine a practical example:
Let's say your tutoring business has recently started teaching Chinese. So fare you are receiving some good interest and bookings for the subject. Nevertheless you are very aware that there are dozens of other agencies also teaching Chinese who are far more established than you.
In order to make sure users know you are now offering Chinese you might need to invest a decent amount of money into paid advertising or spend some time creating email marketing campaigns to make your existing clients aware of these new changes.
It is important to not get overly excited about these products, and be cautious to make sure you get a decent return on your investment.
3. Cash cows
These are your products which offer low growth, but you have a solid market share.
The cash cow of your tutoring agency will be the subject you are most well known for teaching. Are you the go to Maths tutor in your area? If so chances are Maths is your cash cow!
The advice given for cash cows is simple: milk these sources of income as much as possible, but make sure you keep the cow alive.
These are products you have high growth and high market share for. This will be a service your agency is well known for and continues to make more and more money from. Any products within your star category will likely give you a very high Return of Investment.
Make sure you keep investing in these products and monitor your growth closely.
Try it yourself!
The BCG Matrix is a really powerful tool any tutoring agency owner can use to help stimulate organic growth and to help create an effective growth strategy.
We suggest that you take a few minutes out of your day and try this exercise yourself. You could use the analytics tab within your TutorCruncher account to get a better insight into which subjects belong in each of the four sections of your BCG Matrix.
Want to learn more about the analytics tools we offer to help you track your business better? Try TutorCruncher today and track your business effortlessly.