Simplified overview:
New offers would start in the top right quadrant as a 'question mark' - no one knew how they'd perform at this stage.
If an offer went extremely well, it would move to the left and become a 'star'; if it went poorly, it would move down to the bottom right and become a 'pet'; if it was profitable but not a crazy success, it became a 'cash cow'.
Stars would usually become cash cows after the initial hype wore down or they'd become a pet if it was a fad and the offer was no longer profitable or desirable - think of Beanie Babies for an example of a star turned pet.
The idea behind this matrix was that your business should have a mix of offers.
This allows you to 'milk' your cash cows to fund stars, rework or retire pets, and invest in the future success of your question marks.
So, while people loved the idea of having lots of stars, it was the cash cows which were doing all the real work, enabling the business to invest in it's next big hits.
Example: Apple
Apple had a question mark called the iPod. It quickly became a star then dropped to cash cow as new iPod versions came out such as the Nano and Shuffle.
All this iPod money funded development for the iPhone, the next question mark that moved quickly to star with the iPod shifting to become a pet.
And so it goes with the iPad, until we're here today with the next question mark being their streaming and software services.
For Your Business
Coming back to shiny object syndrome, most businesses never have a star and usually only have one cash cow offer which keeps them afloat.
(If you're a consultant or freelancer, it's likely you don't even have a cash cow yet, instead having multiple question marks that pay the bills and not much else.)
Most businesses often have a question mark in the pipeline that gets dropped to pets prematurely because some new thing, a shiny object, catches their interest, stopping development of whatever they were working on.
This is why it's important to understand what you're spending your time on and whether you should consider something new.
A Rule of Thumb
Conventional wisdom from Bruce Henderson of BCG said that 70% of your resources should be devoted to your stars with the remaining 30% on experimenting with your question marks and pets.
If it's good enough for BCG it's good enough for me, so that's the same proportion of time and money I try to spend on the various offers in my own business.
It ensures I've got new things in the pipeline funded by things I know are working and bring in money.
So, looking at your own business, is it full of question marks? Are you lacking in cash cows? Do you understand what will likely be your next star? Are you aware of your pets?
Unfortunately, when I consult with most businesses, they don't have a clue.
And, if you're in the same boat, here's some advice:
Your number 1 priority is to create your cash cow offer, above all else. Work on your most promising question marks and don't be distracted by any shiny objects along the way until they're consistently and reliably making you money.
I know that was a lot of theory, so if you need more actionable advice for your own business, hit 'reply' and ask - happy to help and I can use your questions as examples in the Facebook group to help others.
