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Chapter 10 Crafting The Brand Positioning


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Chapter 10 Crafting The Brand Positioning

  1. 1. Part 3 : Connecting with Customers Chapter 10 – Crafting the Brand Positioning
  2. 2. Product Life-Cycle (PLC) Marketing Strategies <ul><li>A company’s positioning and differentiation strategy must change as the product, market & competitors change over the product life cycle </li></ul><ul><li>The general sequence of stages in any life cycle: </li></ul><ul><li>Introduction stage is marked by slow growth and minimal profits (heavy expenses of product introduction) </li></ul><ul><li>Growth stage is marked by rapid sales growth (market acceptance) and substantial profit improvement </li></ul><ul><li>Maturity stage in which sales growth slows and profits stabilize (increased competition) </li></ul><ul><li>Finally the product enters a decline stage </li></ul>
  3. 3. Product Life-Cycle (PLC) Marketing Strategies <ul><li>Marketing Strategies in Introduction Stage : </li></ul><ul><li>Speeding up innovation time as market pioneer gains the most advantage ex early users recall brand name and repeat purchase and the brand establishes attribute the product class </li></ul><ul><li>Imitators surpassed the innovators by offering low prices and improve product continuously </li></ul>
  4. 4. Product Life-Cycle (PLC) Marketing Strategies <ul><li>Marketing Strategies in Growth Stage : </li></ul><ul><li>Market penetration strategy (current product to current customer, ex persuade customer to buy frequently) </li></ul><ul><li>Market development strategy (current product to new market ex new channel from small outlet to hypermarket ) </li></ul><ul><li>Product development strategy (by new product to new customer) </li></ul><ul><li>The firm lowers prices to attract the price - sensitive buyers </li></ul>
  5. 5. Product Life-Cycle (PLC) Marketing Strategies <ul><li>Marketing Strategies in Maturity Stage : </li></ul><ul><li>Finding niche market by focusing profitable segment </li></ul><ul><li>Increasing advertising and consumer promotion </li></ul><ul><li>Increasing R&D budgets to develop product improvement and line extension </li></ul><ul><li>Concentrating on more profitable products and phase out weak products </li></ul>
  6. 6. Product Life-Cycle (PLC) Marketing Strategies <ul><li>Marketing Strategies in Declining Stage : Initially, there is product-review committee to make recommendation each product – leave it alone, modify its marketing strategy or drop it. After then the marketing strategies will be: </li></ul><ul><li>Increasing the firm’s investment (to strengthen its competitive position </li></ul><ul><li>Maintaining the firm’s investment until the uncertainties about the industry are resolved </li></ul><ul><li>Decreasing the firm’s investment level selectively by dropping unprofitable customer groups </li></ul><ul><li>Divesting the business quickly by disposing of its assets as advantageously as possible </li></ul>
  7. 7. Market Evolution <ul><li>Firms need to visualize a market’s evolutionary path as it is affected by new needs, competitors, technology, channels, and other developments </li></ul><ul><li>Like products, markets evolve through four stages: emergence, growth, maturity, and decline </li></ul><ul><li>Ex LEGO Group, the Danish toy company, leaving traditional toy with redefined its market as “family edutainment” (supported by software, computer & electronics). The market evolution : </li></ul><ul><li>Emergence : it exists a latent market that target market vary greatly in their preferences. On launching products, the niche or mass market strategy begins </li></ul>
  8. 8. Market Evolution <ul><li>Growth : Small firm avoid head on competition with the pioneer and to launch its brand in certain area or focusing market. But the large firm (abundant resources) will head on competition with the pioneer and end up with mass market </li></ul><ul><li>Maturity : consist of market fragmentation which is small segment to be served (brought by competition) and market consolidation which is expansive area to be served (brought by innovation) </li></ul><ul><li>Decline : total need level declines and a new technology replaces the old </li></ul>