Transcript Product Life Cycle

Introduction
Growth
Product Life Cycle
Decision
Point
Decline
Maturity
Traditional Product Life Cycle
Product Life Cycle
Sales
M aturity
Decline
Growth
Decision Point
Introduction
Time
Traditional PLC
Introduction
– When a new product is launched into the
marketplace…the birth of a new product
– Very expensive (warehouse space, new packaging,
labeling, production equipment, market research
costs etc.)
– Marketing efforts are focused on selling to the early
adopters (first consumers)
– Will use either a PUSH strategy (efforts are focused
on product placement in stores) or PULL strategy
(use advertising to forge a +ve association with the
product in the consumers mind)
Growth
• Word of mouth advertising is crucial at this
stage, product must be visible
• Companies will advertise heavily at this
stage
• The product will either catch on or fail
Maturity
• Sales of a product increase much
slower
• Marketers keep the name of their
brand visible
• Invest little $ in new advertising, while
original promotional mix is less
frequent
• More chance for profitability because
costs are low
Decline
• Happens when a company is
unable to find new customers
for their product(s)
• Marketers will try various
tactics to get out of this stage
(re-design/re-package/reprice)
Decision Point Stage
• Marketers make important brand
management decisions regarding the
products future
• Usually involves new promo and new
pricing (example: Cow Brand baking soda
made a market shift to focus on a product that
removes odors from freezers, litter boxes etc.)
Nontraditional PLC’s
FAD
•A product, service or idea
that is extremely popular for
a very brief period of time
•Becomes unpopular just
as quickly, vanishing soon
after it’s introduction to the
marketplace
•When fads die, businesses
run the risk of being caught
with large amounts of
unwanted inventory
NICHE
Sales
Niche
Time
•A small section of the
market that a product
dominates
•Because the market is so
small, there is little
competition
•Example: the Pet Hotel in
Peterborough, Ontario is
a niche market because
there are not enough
consumers to make the
market attractive to
competitors, however the
market is large enough to
be profitable.
Seasonal
Seasonal
•The impact that seasonal
changes will have on the
life of a product will depend
on the product (I.e. Ice
ceam parlours)
Sales
•Marketers of seasonal
products and services
anticipate periods of high
and low demand
Time
•These companies will work
extra hard to create
demand outside the peak
season.