Ch11 Product Life Cycle

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Excerpt from Chapter 11 Competitive Dynamics - Product Life Cycle. Marketing Management (Kotler et.al)

Excerpt from Chapter 11 Competitive Dynamics - Product Life Cycle. Marketing Management (Kotler et.al)

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  • 1. PRODUCT LIFE CYCLE Jocelyn M. Evangelista 7 February 2014
  • 2. Product Life Cycle I. Definition II. Four Stages and Marketing Objectives III. Characteristics IV. Common Product Life Cycles
  • 3. Product Life Cycle I. Definition A business analysis that attempts to identify distinct stages in the sales history of the product
  • 4. Product Life Cycle II. Four Stages and Marketing Objectives 1. Introduction – create product awareness & trial 2. Growth – maximize market share 3. Maturity – maximize profit while defending market share 4. Decline – reduce expenditure
  • 5. Product Life Cycle
  • 6. Product Life Cycle III. Characteristics 1. Introduction Stage ◦Slow sales growth. ◦Products need to establish themselves in the market place. ◦Negative or low profits.
  • 7. Product Life Cycle III. Characteristics 2. Growth Stage ◦Rapid sales growth. ◦Early adapters like the product & additional consumers start buying it. ◦Sales rise much faster than expenditures in promos.
  • 8. Product Life Cycle III. Characteristics 1. Maturity Stage Three Phases : 1)Growth – Sales growth starts to slow; new competitive forces emerge. 2)Stable – Reached market saturation 3)Decaying Maturity – consumers begin switching to other products.
  • 9. Product Life Cycle III. Characteristics 4. Decline Stage ◦End of the product life. ◦Period of the market's sale are significantly below the peak and are declining.
  • 10. Product Life Cycle IV. Common Product Life-Cycle Patterns Growth-Slump-Maturity sales grow rapidly when product is first introduced, falls, & stabilizes
  • 11. Product Life Cycle IV. Common Product Life-Cycle Patterns Cycle-Recycle - often describes the sales of new drugs
  • 12. Product Life Cycle IV. Common Product Life-Cycle Patterns Scalloped - succession of lifecycles based on discovery of new charcteristics, uses or users.
  • 13. Summary Periodic examination of products is appropriate because strategies change as products move through their life cycle.