Ch11 Product Life Cycle

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

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Ch11 Product Life Cycle

  1. 1. PRODUCT LIFE CYCLE Jocelyn M. Evangelista 7 February 2014
  2. 2. Product Life Cycle I. Definition II. Four Stages and Marketing Objectives III. Characteristics IV. Common Product Life Cycles
  3. 3. Product Life Cycle I. Definition A business analysis that attempts to identify distinct stages in the sales history of the product
  4. 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. 5. Product Life Cycle
  6. 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. 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. 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. 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. 10. Product Life Cycle IV. Common Product Life-Cycle Patterns Growth-Slump-Maturity sales grow rapidly when product is first introduced, falls, & stabilizes
  11. 11. Product Life Cycle IV. Common Product Life-Cycle Patterns Cycle-Recycle - often describes the sales of new drugs
  12. 12. Product Life Cycle IV. Common Product Life-Cycle Patterns Scalloped - succession of lifecycles based on discovery of new charcteristics, uses or users.
  13. 13. Summary Periodic examination of products is appropriate because strategies change as products move through their life cycle.

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