A cash cow is one of the 4 quadrants in the BCG matrix. A cash cow is a referral term used for the business, unit or product which generates high cash flow with less investment over a long period. These products or businesses are in a mature slow-growth stage which requires less investment and have a high market share. Cash cow represents strong brands in the market. These brands generate high revenue which helps the companies to give high dividends.
Example of Cash Cow:
Apple’s MacBook and iMac’s fall under the cash cow category. These products have a strong consumer base who are loyal to buy Apple products. Apple generates high revenues due to its strong brand image which help it to invest in other projects with reserve money. Microsoft, IBM or Intel have cash cows whose returns are far greater than the market growth.
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