cash cow
cash cow
Meaning
- a consistently profitable business or product that requires minimal effort.
- a product or service generating stable, high revenue with low maintenance costs.
- an enterprise yielding significant profit without continual investment.
- a lucrative asset effortlessly produces steady income.
Example Sentences
- Despite its age, the software continued to be a cash cow, generating immense revenue without any major updates.
- The old, rusted amusement park turned out to be a cash cow, raking in millions every summer despite its decrepit rides.
- Who knew that selling vintage comic books online would transform into such an effortless cash cow?
- The quirky board game, initially a flop, evolved into a cash cow, its sales skyrocketing unexpectedly during the holiday season.
- Surprisingly, her blog about medieval pottery became a cash cow, attracting advertisers and sponsorships galore.
Origin and History
The term “cash cow” began as “milch cow” in the early 1600s before evolving into the modern “cash cow.” This phrase linked agriculture to financial success, a fitting analogy for the agriculture-dominated, pre-industrial 17th century.
Back then, just like today, it evoked the image of a dependable, enduring source of income—milk could be sold for cash—requiring minimal effort or upkeep. However, the exact financial application of “cash cow” only appeared after the 1950s.
Peter Ferdinand Drucker, an Austrian American management consultant, is credited with coining “cash cow” in the mid-1960s. He used it to describe a business or product line with a large market share in a stagnant or declining market. Drucker also introduced the term “knowledge worker.”
Cash cows form one of the four quadrants in the BCG matrix, a strategic tool developed by the Boston Consulting Group in the early 1970s. Known as the Boston Box or Grid, the BCG matrix categorizes businesses or products into four groups: star, question mark, dog, and cash cow.
This matrix aids firms in understanding their market position and industry growth rate, offering a comparative analysis of a business’s potential and an evaluation of the industry and market.
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