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    Product Life Cycle

    Uploaded by

    Pranav Kumar
    The document discusses product life cycle strategies. It describes common causes of new product failures such as overestimating market size or incorrectly positioning a product. It then outlines the typical stages in a product life cycle: introduction, growth, maturity, and decline. For each stage, it provides details on sales, costs, profits, and marketing objectives. Finally, it shows the relationship between the diffusion process and the product life cycle curve.

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    Product Life Cycle

    Uploaded by

    Pranav Kumar
    12 views8 pages
    The document discusses product life cycle strategies. It describes common causes of new product failures such as overestimating market size or incorrectly positioning a product. It then outlines the typical stages in a product life cycle: introduction, growth, maturity, and decline. For each stage, it provides details on sales, costs, profits, and marketing objectives. Finally, it shows the relationship between the diffusion process and the product life cycle curve.

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    product_life_cycle

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    The document discusses product life cycle strategies. It describes common causes of new product failures such as overestimating market size or incorrectly positioning a product. It then outlines the typical stages in a product life cycle: introduction, growth, maturity, and decline. For each stage, it provides details on sales, costs, profits, and marketing objectives. Finally, it shows the relationship between the diffusion process and the product life cycle curve.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    12 views8 pages

    Product Life Cycle

    Uploaded by

    Pranav Kumar
    The document discusses product life cycle strategies. It describes common causes of new product failures such as overestimating market size or incorrectly positioning a product. It then outlines the typical stages in a product life cycle: introduction, growth, maturity, and decline. For each stage, it provides details on sales, costs, profits, and marketing objectives. Finally, it shows the relationship between the diffusion process and the product life cycle curve.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 8

    9-1

    Product Life-Cycle Strategies


    Causes of New Product Failures 9-2

    • Overestimation of Market Size


    • Product Design Problems
    • Product Incorrectly Positioned, Priced or
    Advertised
    • Costs of Product Development
    • Competitive Actions
    • To create successful new products, the
    company must:
    – understand it’s customers, markets and
    competitors
    – develop products that deliver superior value to
    customers.
    9-3
    Product Life Cycle

    Sales and
    Profits ($)

    Sales

    Profits

    Time
    Product Introduction Growth Maturity Decline
    Develop-
    ment

    Losses/
    Investments ($)
    Introduction Stage of the 9-4

    PLC

    Sales Low sales

    Costs High cost per customer

    Profits Negative
    Create product awareness
    Marketing Objectives
    and trial
    Product Offer a basic product

    Price Use cost-plus

    Distribution Build selective distribution


    Advertising Build product awareness among
    early adopters and dealers
    Growth Stage of the PLC 9-5

    Sales Rapidly rising sales

    Costs Average cost per customer

    Profits Rising profits


    Marketing Objectives Maximize market share
    Offer product extensions,
    Product service, warranty
    Price Price to penetrate market

    Distribution Build intensive distribution


    Advertising Build awareness and interest in
    the mass market
    Maturity Stage of the PLC 9-6

    Sales Peak sales

    Costs Low cost per customer

    Profits High profits


    Marketing Objectives Maximize profit while defending
    market share
    Product Diversify brand and models
    Price to match or best
    Price competitors
    Distribution Build more intensive distribution
    Advertising Stress brand differences and
    benefits
    Decline Stage of the PLC 9-7

    Sales Declining sales

    Costs Low cost per customer

    Profits Declining profits


    Marketing Objectives Reduce expenditure and milk the
    brand
    Product Phase out weak items
    Price Cut price
    Go selective: phase out
    Distribution unprofitable outlets
    Advertising Reduce to level needed to retain
    hard-core loyal customers
    9-8

    Relationships between the Diffusion Process


    and the Product Life Cycle

    Product
    life cycle
    curve

    Diffusion
    curve

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