Diversification is a growth strategy in which a business markets new products in new markets. This is an inherently more risk strategy because the business is moving into markets in which it has little or no experience.
For a business to adopt a diversification strategy, therefore, it must have a clear idea about what it expects to gain from the strategy and an honest assessment of the risks.
In the case of Cathay Pacific Airways, market development and product development best suite their way of doing business. Market development is a suitable to business since they have already penetrated the existing markets they and now it is important to market their product on new markets. Product development is also suitable to maximize their profits. Product development would also enable them to offer more products and services in which are needed by the existing customer and may also invite potential customers thus increasing their profits.