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Product Life Cycle- Stages and
Strategies
Vikas 12PGP050
Komal 12PGP
Prateek 12PGP110
Srishti 12PGP043
Sourav 12PGP042
1/29/2015 IIM Raipur 1
PLC- Overview
• Every product has a life in a market.
• Tenure of the life is uncertain.
• Stages in PLC:
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PLC Implications
• Products have a definite life period.
• Product sales pass through distinct stages with
each stage posing Challenges/Opportunities/
Problems.
• Profits rise/fall during different stages of
product life cycle.
• Products require different marketing
strategies at each stage
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PLC- Stages
• Introductory Stage- Product just introduced in
the market.
• Growth Stage- Sales are rising.
• Maturity Stage- Sales do not rise any further.
• Decline Stage- Sales are falling.
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Time
Product
Develop-
ment
Introduction
Profits
Sales
Growth Maturity Decline
Losses/
Investments ($)
Sales and
Profits ($)
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Introductory Growth Maturity Decline
• Product has just been introduced in the
market.
• Product shows slow sales growth.
• Profits are Low or negative as as RnD costs
might have been incurred, also, no economies
of scale advantage as low sales.
• Little or no competetion faced
• Pioneers adopt the product
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• Product: Basic
• Distribution: Selective
Introductory Growth Maturity Decline
Price
HIGH LOW
HIGH Rapid Skimming Rapid Penetration
LOW Slow Skimming Slow Penetration
Pricing
Promotion
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Rapid Skimming Strategy
• new product is launched at high price with high
promotion level
• High price helps firm to recover max profits/ units.
• High promo helps in customer awareness/ adoption.
• This policy is fruitful under following conditions:
– Large part of product market is unaware of product.
– Those who become aware are eager to have it & can pay
asked price.
– Firm faces potential competition & wants to build brand
preference.
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Slow Skimming Strategy
• New Product launched at high price with low
promotion.
• High price helps firm to recover maximum profits
/units.
• Low promo keeps marketing expenses down.
• Combination is expected to skip high profit from the
market.
• This strategy is used under following conditions
– Market size is limited.
– Market is aware of product.
– Buyers are willing to pay high price.
– Potential competition is not imminent.
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Rapid Penetration Strategy
• New Product launched at low price with high
promotion.
• Helps to achieve:
• Fastest market penetration.
• Largest market share.
• This strategy is used under following conditions
– Market is large.
– Market is unaware of the product.
– Buyers are price sensitive.
– Strong product competition exists.
– Costs likely to decreases with volume.
– Example: Reliance Hungama, Nirma, and Wheel
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Slow Penetration Strategy
• New Product launched at low price with low
promotion.
• Low price encourages rapid product acceptance,
• Low promotion cost helps retain profits.
• This strategy is used under following conditions
– If market is large.
– If market is highly aware of product.
– If market is price sensitive.
– If market is minimally sensitive to promotion.
– If Product competition exists.
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• Sales rising exponentially
• Sales limited by production
Capacity.
• Profit increasing.
• “Sales Pull”
• Product
Introductory Growth Maturity Decline
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Introductory Growth Maturity Decline
Sales
Costs
Profits
Marketing Objectives
Rapidly rising sales
Average cost per customer
Rising profits
Maximize market share
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Product
Price
Offer product extensions,
service, warranty
Price to penetrate market
Distribution Build intensive distribution
Advertising Build awareness and interest in
the mass market
Introductory Growth Maturity Decline
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Introductory Growth Maturity Decline
Sales
Costs
Profits
Marketing Objectives
Peak sales
Low cost per customer
High profits
Maximize profit while
defending
market share
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Product
Price
Diversify brand and models
Price to match or best
competitors
Distribution Build more intensive
distribution
Advertising Stress brand differences and
benefits
Introductory Growth Maturity Decline
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Introductory Growth Maturity Decline
Sales
Costs
Profits
Marketing Objectives
Declining sales
Low cost per customer
Declining profits
Reduce expenditure and milk
the brand
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Introductory Growth Maturity Decline
Product
Price
Phase out weak items
Cut price
Distribution Go selective: phase out
unprofitable outlets
Advertising
Reduce to level needed to
retain
hard-core loyal customers1/29/2015 18IIM Raipur
PLC Variants- Style
•PLC Graph is shown on the right.
•Style is a basic/distinctive mode
of expression appearing in a field
of human endeavors.
•Once a style is invented, it can
last for generations, at times
going in/ going out.
•A style has a cycle showing
several periods of renewed
interest.
Example: Styles appear in homes
(colonial, ranch, transitional),
Clothes(formal and casual) and
art(realist, surrealist, abstract).
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PLC Variant- Fashion
Fashion is a currently
accepted/popular style in a given field.
For Example: The more formal
business attire Clothes: Jeans, Music:
Hindi-Pop.
- Fashion Pass through four Stages:
•Distinctiveness Stage: Same customer
take interest in something new that
sets them apart.
•Emulation Stage:Other customers
take an interest out of desire to
emulate fashion leaders.
•Mass-Fashion Stage: Fashion
becomes very popular &
manufacturing gear up for mass
production.
•Decline: Consumer starts moving
towards other fashion.
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PLC Variant- Fad
Fads are those periods which
have temporary unusually high
sales driven by consumer
enthusiasm. In this duration the
product or brand gets immediate
popularity. Some important
points of fads are written below:
•Fads is kind of fashion that
comes quickly into the public eye.
It gets adopted with great zeal,
peak easily and decline fast too.
•It has short acceptance cycle.
•Fads tend to have limited
followings
•For Example: Pepsi Blue, Yo Bike,
Pager.
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CASE LETS ON DIFFERENT
MARKETING STRATEGIES
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Maruti 800
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Introduction Stage
• Period duration of 1983-1986
• Maruti launched 1st 800 in Indian market in
1983
• Cheapest Car in Indian market
• Also sold to countries of South Asia and South
America market
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Marketing Strategy In Introduction
Stage
• Rapid Penetration Marketing Strategy was
used in this stage.
• Exported to countries like South Asia and
South American market to increase number of
customers.
• Labeled as Cheapest car for Indian Market
• Initially First car was presented to Lord
Venkateshwara of Tirumala Venkateshwara
Temple as Promotion
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Growth Stage
• This stage is of the duration of 1987-1996
• Sales increased from about 63763 units to
about 189061 units in 1996
• Different features were implemented in basic
car model.
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Marketing Strategy Used in Growth
Stage
• Maruti 800 came up with new feature like AC
version and music system
• First export began in 1987
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Marketing Strategy In Maturity Stage
• Maturity stage was for the duration of
1997-2002
• Launched revamped version of Maruti
800 EX, with new engine,
• Entry of competitors like General Motors,
Ford, Tata
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Marketing Strategy In Maturity Stage
Contd.
• Market share beaten by rivals like Hyundai
Santro, Daewoo Matiz
• Introduced LPG and CNG variabts, called
Maruti 800 Duo with new
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Decline Stage
• Period of range 2002-2012
• Sales of Maruti went down drastically from
1,51,976 units in the year 2000 to about
69,553 in 2007
• Buyers attracted by high end luxuries small
cars
• Sales volume is heavily beaten by competitors
like Hyundai i10, Maruti Suzuki swift, Chevrolet
Spark
• In 2008-09 experienced sales of only 11,288
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Marketing Strategy In Decline Stage
• Stopped the production of Maruti 800
• Launched the new model maruti Alto 800 as
replacement of maruti 800
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Product Life Cycle of Hero Honda CBZ
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Introduction Stage
• Hero Honda CBZ was launched in early 1999
by Hero Honda Motors Ltd
• It was the first sports oriented 4-stroke bike
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Marketing Strategy used In
Introduction Stage
• It has the feature of larger spring operated nozzle
to provide a richer fuel air mixture in to engine
for better acceleration.
• Styling of bike was scaled version of famous
Honda CB Series
• It was labeled as Fast and Sport looking bike
• Target market were young boys in the age 18-30
middle class.
• Positioning were bikers who want to live life in
extreme.
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Market Break-up
51%
26%
11%
3% 3%
Sales
Hero Honda
Bajaj
Yamha
TVS
OTHERS
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Growth Stage Contd..
• Sales increased in this stage for Honda CBZ
• Promotion is increased in this stage to cope
with competition.
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Product Life Cycle of Tata Nano
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Introduction Stage
• Nano was launched in 2008
• Launched with basic model
• The Cheapest car in the world
• Initial Price Rs 1.26 lakhs on road
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Growth Stage
• Nano is available in tree model ( Nano Basic,
Nano CX and Nano LX)
• Sale of Nano in June 2011 approximately 6515
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Marketing Strategy Used By Tata Nano
• Tata motors share promotion of tata brand
with its multiple bank partners. These
financiers will promote the nano brand during
booking jointly with tata motors
• Tata marketing team used various media like
radio, news on TV, online games, major
website like facebook, orkut etc.
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Nokia Lumia
• Nokia lumia a series of smart phone by
• nokia
• Based on window phone operating system
• Deviant of Nokia lumia, Lumia 710,lumia
820, lumia 920
• Lumia 920 with 4 GB
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PLC Stage
• Introduced in 2011
• Growth stage
• Increasing sale
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Target market & Strategies- Lumia
• Targeted for Heightened market
• Rapid skimming strategy
• High promotion
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Sony Bravia
• Facility of HD input
• Different Deviant from size range 56cms to
140 cms
• Price range Available from Rs 15900
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PLC Stage
• Launched in the year 2005
• Growth Stage
• market share of 32% by value
• sale of more than 35 thousand in December
2010
• growth of 46% comparing to previous year
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Target market
• Targeted to the age group young generation
the age group of 25-45
• Targeted Young family
• Targeted to business related personal
• Tag Line - More Bright. More Vivid. More Joy.
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Strategy
• Concentration Strategy by targeting specific
group
• Differentiation strategy by offering unique
value preposition
• Rapid skimming Strategy
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Nokia 800
• 4.0-inch AMOLED Clear Black display with a
360 x 640 pixel resolution
• 16GB internal storage
• Memory expandable up to 32 GB via micro SD
car
• Bluetooth 3.0 with A2DP, USB 2.0
• 41 megapixel camera with Xenon flash,
1080p@30fps video recording
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PLC Stage
• Launched in February 2012
• Introduction stage
• High premium 24999
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Target Market
• Yong urban male/female
• Educated professional
• Upper class People
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Strategy
• High premium
• Rapid Skimming
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Surf Excel
• Product from HUL
• Launched in 1954
• Created strong brand over the 5 decades
• Market leader for 50 years
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Product range
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Price chart
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PLC Stage
• Maturity Stage
• Competitors such as Nirma, Tide, Ghari, Ariel
• 38% of detergent market
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Strategy
• An emotional appeal by statement “Dag
achhe hain” (dirt is good)
• Extensive advertisement
• Rational price
• lot of Variant and deviant according to need
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• LUX
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Lux
• World’s first beauty soap targeting upper class
market
• Launched in US in 1924
• Launched in India in 1929
• Initially, in India this product was launched in
cities like Calcutta, Mumbai
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Introduction Stage:
• Lux launched the world’s first mass-market
beauty soap is the US in 1924
• First launched in India in 1929
• Lux over the world UK(1928), SRILANKA(1931),
BRAZIL(1932) PAKISTAN(1957) etc
• In this stage, LUX followed Rapid Skimming
strategy.
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Maturity Stage
• Lux product could be found in over 100
countries and they had the sales of 1.0 billion
euros in 2005
• In this stage, few competitors enter into the
market like (Cinthol, Fairglow, Santoor,
Chandrika, Fiama Di Wills and Vivel)
• Competition from its own brand Lifebuoy
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Marketing Strategies Used
• Product: The lux has introduced various modified
versions of the product like Lux Almond, Lux Orchid,
Lux Fruit, Lux Saffron, Lux sandalwood, Lux Rose, Lux
oil and Honey etc.
• Price: The Lux products are now available at higher
prices to maximize company profit.
• Distribution: Lux has strong distribution across cities of
India.
• Advertising: In the latest campaign the Asit sin and
kajal Aggarwal are used as their brand ambassador.
• Promotional Offers: At times Lux has offered Buy3 get
1 Free offer to customers.
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Rapid Skimming Strategy
• Product: Only one basic product without any
variants/deviants/frills
• Price: Relatively higher prices, to recover their
initial cost of making the product
• Place- Budget allocation was more for
advertising, to attract more and more customers.
• Distribution- was selective and only covering the
major cities of India.
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Rapid Skimming Strategy
• Promotion: Awareness marketing
• Target Market: Upper class market – females
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Introductory Growth Maturity Decline
Sales
Costs
Profits
Market
Low sales
Higher cost per customer
Negative or not very substabtial
Pioneers, early adopters
No competitorsCompetition
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Growth stage
• In this stage, for LUX, main objective of LUX
was to expand in India
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Marketing Strategy
• Product: Only one basic product without any
variants/deviants/frills
• Price: Price Rationalization
• Place- Budget allocation was more for
advertising, to attract more and more
customers.
• Distribution- expanded the market and now
covering the other cities of India as well.
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Marketing Strategy
• Promotion: Affectation Realm (liking +
preferences+ conviction)
• Market: Pioneers, early adopters
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Introductory Maturity Decline
Sales
Costs
Profits
Market
Higher sales, growth rate in sales is very
high
Average cost per customer
Emerging
Pioneers, early adopters
NegligibleCompetition
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Maturity Stage
• In this stage, LUX has expanded its market
across India and objective now is to maximize
and defend its market share.
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Marketing Strategy
• Product: Product with many
variants/deviants/frills- Lux Almond, Lux
Orchid , Lux Fruit, Lux Saffron, Lux
Sandalwood, Lux Rose, Lux International, Lux
Chocolate, Lux Aromatic Extracts, Lux Oil and
Honey etc
• Price: Lux increased its prices to maximize the
profit
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Marketing Strategy
• Place- Budget allocation is reduced for
advertising, because of the brand awareness
in the minds of customers.
• Distribution- Across India
• Promotion: Incentives
• Market: late majority
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Introductory Maturity Decline
Sales
Costs
Profits
Marketing
Peak Sales, growth rate of sales=0
Low cost per customer
Highest Profits
maintenance marketing
CINTHOL, FAIRGLOW,SANTOOR,
CHANDRIKA, FIAMA DI WILLS and VIVEL
Competition
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Decline
• In-spite of all efforts, Lux is at the decline
stage ,
• 1. Unilever products have presence in over
100countries worldwide thus currency
fluctuations could play a major role.
• For example in 2004, a 5.9% decline in
turnover was primarily due to 4% appreciation
in the average Euro exchange rate.
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• 2.In year 2008 – 09 due to economic recession
in India and other countries, the sales of LUX
got hit hard times.
• 3.Other competition: Lux has been facing
competition from HUL itself (Lifebuoy) & from
other companies like:-
Godrej Consumer Products :
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• GCPL, India’s second largest soap maker with
9.2% marketshare.•with leading brands such
as
• CINTHOL, FAIRGLOW & NIKHAR.
• Fairglow brand, India's first Fairness soap, has
created marketing history as one of the most
successful innovation in soap industry.
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Marketing Strategy
• Price: Lux increased its prices to maximize the
profit
• Place- Budget allocation is reduced for
advertising, because of the brand awareness
in the minds of customers.
• Distribution- Across India
• Promotion: Reduction in expenditures
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Introductory Maturity Decline
Sales
Costs
Profits
Marketing
Forestalling
Low cost per customer
Loss, CM negative
Reduction in expenditures
CINTHOL, FAIRGLOW,SANTOOR,
CHANDRIKA, FIAMA DI WILLS and VIVEL
Competition
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Product Life Cycle Graph
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• Oreo
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Oreo
• Oreo was launched in 1912 in USA
• Its production in USA is by Nabisco division of
Kraft Foods.
• Till now, Oreo is the best selling cookie in USA.
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Maturity Stage
• Oreo cookie has reached the maturity stage in
its life cycle, and the brand has appropriately
taken several steps to prevent the cookie from
fading out of America’s cookie jars.
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Marketing Strategy
• Product: Leadership in cost, quality and
market. Nabisco has launched many different
flavors and varieties of the traditional cookie.
Some of these include: Chocolate Crème Oreo,
Golden Oreo Original, Fudge Covered Oreo,
Fudge Mint Covered Oreo, Golden Oreo
Chocolate Crème,
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• Double Delight Oreo Mint ‘n’ Crème, Double
Delight Oreo Peanut Butter & Chocolate, Milk
Chocolate Covered Oreo and Milk Chocolate
Covered Mint Oreo. Additionally, Nabisco has
released many Oreo baking supplies, such as
Oreo Crumbs, Oreo Chocolate Cones, Oreo
Jello Pudding… the list goes on.
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Marketing Strategy
• Price: Its charges premium price due to its
high price per gram
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• Place- Budget allocation is reduced for
advertising, because of the brand awareness
in the minds of customers.
• Distribution- Across USA, Argentina, Canada,
China, Croatia, Czech Republic, India, Italy,
Norway, Poland, United Kingdom, Arab World
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Promotion- Oreo
• With the introduction of new product lines
under the Oreo name, the cookie is able to
retain the old customers and target new
customer base of kids. What Oreo is striving to
create is an “Oreo consumer identity,”
allowing the consumers to identify themselves
by which Oreo suits their individual desires
and tastes.
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Introductory Maturity Decline
Sales
Costs
Profits
Marketing
Peak Sales, growth rate of sales=0
Low cost per customer
Highest Profits
maintenance marketing
Sunshine Bakeries’ Hydrox cookies, Chips
Cookies
Competition
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Product Life Cycle Graph
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• Maggi Noodles
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• Nestle Maggi Noodles is brand of instant
noodles
• This was launched in India in 1982
• Pioneer in instant noodles- 2minutes
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Introduction Stage
• In this stage, Maggi Noodles followed Rapid
Penetration strategy
• It was found by the Maggi family in
Switzerland in 19th century
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Growth stage
• Few yrs back it enjoyed around 50% market share in
this segment which was valued at around 250 crores.
• during the 1990s, the sales of Maggi noodles declined, due
to growing popularity of Top Ramen, and other noodles
product
• In order to improve sales ,NIL changed the formulation
of Maggi noodles in 1997.
• However, this proved to be a mistake, as consumers did not
like the taste of the new noodles.
• In March 1999, NIL reintroduced the old formulation of the
noodles, after which thesales revived. Over the years, NIL
also introduced several other products like soups and
cooking aids under the Maggi brand.
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strategy
• In latest Campaign Amitabh Bacchhan is
narrating maggi tales of user.
• New variants are launched with feedback from
campaign “Me and MY Maggi”
• Maggi also launched Guess the Taste
Commercial
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Rapid Penetration Strategy
• Product: Only one basic product without any
variants/deviants/frills
• Price: Relatively lower prices, to penetrate
deeper and take the biggest of the market
share. Cost plus
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Rapid Penetration Strategy
• Place- Budget allocation was more for
advertising, to attract more and more
customers.
• Distribution- was selective and only covering
the major cities of India.
• Promotion: Awareness marketing
• Target Segment: Working Women and children
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Introductory Growth Maturity Decline
Sales
Costs
Profits
Market
Low sales
Higher cost per customer
Negative or not very substantial
Pioneers, early adopters
No competitorsCompetition
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Growth Stage
• In this stage, Maggi Noodles main objective
was to expand in India
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Marketing Strategy
• Product: New Product with frills- features,
packaging, quality
• Price: Price Rationalization
• Place- Budget allocation was more for
advertising, to attract more and more
customers.
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Marketing Strategy
• Distribution- expanded the market and now
covering the other cities of India as well.
• Promotion: Affectation Realm (liking +
preferences+ conviction)
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Introductory Maturity Decline
Sales
Costs
Profits
Marketing
Higher sales, growth rate in sales
is very high
Average cost per customer
Emerging
Pioneers, early adopters, 50%
market share
Top RamenCompetition
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Maturity Stage
• In this stage, Maggi noodles have expanded its
market across India and objective now is to
maximize and defend its market share.
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Marketing Strategy
• Price: Maggi noodles offered Rs 5 onwards
• Place- Budget allocation is reduced for
advertising, because of the brand awareness
in the minds of customers.
• Distribution- Across India , more intensive
• Promotion: Incentives- Big Promotional Offers
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Introductory Maturity Decline
Sales
Costs
Profits
Marketing
Peak Sales, growth rate of sales=0
Low cost per customer
Highest Profits
maintenance marketing
Tough Rules of Competition for competitors
like Top Ramen
Competition
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Decline Stage:
• Maggi noodles then faced decline stage
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Marketing Strategy
• Product: New products launched but failed
• Price: Price could not be lowered further
• Place- Budget allocation is reduced for
advertising, because of the brand awareness
in the minds of customers.
• Distribution- Across India, selective
• Promotion: Reduction in expenditures
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Introductory Maturity Decline
Sales
Costs
Profits
Market
Forestalling
Low cost per customer
Loss, CM negative
Laggards
Tough Competition from
competitors
Competition
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Rejuvenation
• Strategy to counter decline: Re-launching
• Maggi Noodles was launched again in 1999.
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Marketing Strategy
• Price: Maggi noodles offered Rs 5 onwards
• Place- Budget allocation is increased for
advertising, new and interesting advertising
campaigns
• Distribution- Across India, more intensive
• Promotion: Incentives- Big Promotional Offers
• Market: Working Bachelors , children
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Product Life Cycle Graph
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• Nintendo WII
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• Nintendo WII released by Nintendo on
November 19 , 2006.
• It’s a home console for video game.
• WII has many advanced features compared to
previous Nintendo consoles.
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• WiiConnect24-enables it to receive messages
and updates through internet even standby
mode.
• Nintendo Wii is the successor of Game Cube.
• In late of 2011, Nintendo reconfigured the
model – Wii Family Edition.
• This edition was not compatible with
Nintendo GameCube.
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Product Life Cycle
• Maturity Stage
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Maturity Stage
Product:
• Motion Sensitivity
• IR Sensors
• Port to allow for a variety of Controller
• Add ons
• Classic controller can also be used for many
WII
1/29/2015 121IIM Raipur
Pricing:
• $250- lower than while XBOX and Play-station
3
• Games cheaper than XBOX and Play-station 3
1/29/2015 122IIM Raipur
• Promotion
• 1.Mass selling
• 2.Uses Intermediaries-GameStop,
Hypermarket , Mall
• 3.Push/Pull Techniques
• Nintendo WII offers a free game and WIFI
connection + updates.
1/29/2015 123IIM Raipur
• Place: Distribution Centers across the globe.
1/29/2015 124IIM Raipur
Introductory Maturity Decline
Sales
Costs
Profits
Marketing
Peak Sales, growth rate of sales=0
Low cost per customer
Highest Profits
maintenance marketing
Tough Rules of Competition for competitors
like XBOX and Play- station 3
Competition
1/29/2015 125IIM Raipur
Product Life Cycle Graph
1/29/2015 126IIM Raipur
• Nokia 6600
1/29/2015 127IIM Raipur
1/29/2015 128IIM Raipur
• This product when launched was the premium
product of Nokia
• It build the brand of Nokia
• Most popular brand of Nokia
1/29/2015 129IIM Raipur
Product Life Cycle
• Decline stage
• When Nokia 6600 was in decline stage, Nokia
decided to stop its production
• The product was blocked from production
since 1997
1/29/2015 130IIM Raipur
Marketing Strategy
• Sales- sales were freely falling.
• Market – Market now Laggards, which
comprise of 16% of the market.
• Profit-Loss, Contribution margin=Unit Selling
Price –Unit Variable Cost becomes negative
1/29/2015 131IIM Raipur
Strategy- Nokia
• Strategy of the company: Closure
• Nokia preferred to stop the production of the
product because with price rationalization of
Nokia 6600, within range of 4000-6000 and
with the expandable memory and installation
capacity, it occurred as a threat to the higher
range mobiles of Nokia itself.
1/29/2015 132IIM Raipur
Product Life Cycle Graph
1/29/2015 133IIM Raipur
• KFC
1/29/2015 134IIM Raipur
1/29/2015 135IIM Raipur
KFC
• Kentucky Fried Chicken-is chain of fast food
restaurants
• They offer chicken with their special secret
condiments recipe.
• It entered into the market in 1954 in USA.
1/29/2015 136IIM Raipur
Introduction stage
• By early entry into the market, it managed to
have strong name and strong control over the
market.
• They followed Rapid Skimming Strategy.
1/29/2015 137IIM Raipur
Rapid Skimming Strategy
• Product: Few basic product without any
variants/deviants/frills
• Price: Relatively higher prices, to recover their
initial cost of making the product and also to
take the advantage of being pioneers in fast
food industry
1/29/2015 138IIM Raipur
Rapid Skimming Strategy
• Place- Budget allocation was more for door to
door, to attract more and more customers and
prospective franchises of USA
• Distribution- was selective and only to
franchises in USA
• Promotion: Awareness marketing
• Market: Upper Class
1/29/2015 139IIM Raipur
Introductory Growth Maturity Decline
Sales
Costs
Profits
Market
Low sales
Higher cost per customer
Negative or not very substantial
Pioneers, early adopters
No competitors in Chicken
Products
Competition
1/29/2015 140IIM Raipur
Growth Stage
• From 1970’s, 1980’s 1990’s , KFC followed an
aggressive strategy of expanding it’s chain
across the world
1/29/2015 141IIM Raipur
Marketing Strategy
• Product: More product with many
variants/deviants/frills
• Price: Relatively higher prices, to recover their
initial cost of making the product and also to
take the advantage of being pioneers in fast
food industry
1/29/2015 142IIM Raipur
Marketing Strategy
• Place- Budget allocation was more for door to
door, to attract more and more customers and
prospective franchises of USA and outside USA
• Distribution- was selective and only to
franchises in USA
• Promotion: Affectation Realm (liking +
believability + conviction)
• Market: Upper Class
1/29/2015 143IIM Raipur
Introductory Maturity Decline
Sales
Costs
Profits
Market
Higher sales, growth rate in sales
is very high
Average cost per customer
Emerging
Pioneers, early adopters
Competitors like McDonaldsCompetition
1/29/2015 144IIM Raipur
Maturity Stage
• In this stage, KFC has expanded its market
across and outside USA and objective now is
to maximize and defend its market share
1/29/2015 145IIM Raipur
Marketing Strategy
• Product: Product with many
variants/deviants/frills- Chicken wings,
Popcorn Chicken, Veg Burgers, Zing kong box
• Price: KFC rationalized its price to expand its
market
1/29/2015 146IIM Raipur
Marketing Strategy
• Place- Budget allocation is reduced for
advertising, because of the brand awareness
in the minds of customers.
• Distribution- Across and outside USA
• Promotion: Incentives
1/29/2015 147IIM Raipur
Introductory Maturity Decline
Sales
Costs
Profits
Marketing
Peak Sales, growth rate of sales=0
Low cost per customer
Highest Profits
maintenance marketing
Tough Rules of Competition from competitors
like McDonalds
Competition
1/29/2015 148IIM Raipur
Decline Stage
• KFC reaching decline stage because of too
many competitors. But they added new
features and packages, also new line of
desserts to reintroduce their products and
thus maintained their position
1/29/2015 149IIM Raipur
Introductory Maturity Decline
Sales
Costs
Profits
Market
Forestalling
Low cost per customer
Loss, CM negative
Laggards
Tough Competition from
competitors
Competition
1/29/2015 150IIM Raipur
Strategy
• After introduction of desserts line like Brownie
Sundae and Crushers, KFC was again able to tap
the market
1/29/2015 151IIM Raipur
Marketing Strategy
• Price: Price rationalized
• Place- Budget allocation is reduced for
advertising, because of the brand awareness
in the minds of customers.
• Distribution- Across USA and outside USA
• Promotion: Reduction in expenditures
• Market: Upper class as well as middle class,
working bachelors
1/29/2015 152IIM Raipur
• Sales: Higher sales, growth rate in sales is very
high
• Costs: Average cost of production/customer
• Profit: Emerging
• Marketing: Pioneers, early adopters, late
adopters , laggards
• Competitions- Competitors like McDonalds,
Subway
1/29/2015 153IIM Raipur
Product Life Cycle Graph
1/29/2015 154IIM Raipur
Cinthol
1/29/2015 155IIM Raipur
Introduction stage
• launched in the year 1952
• Positioned in the Premium soap segment
• Positioned as a masculine brand
1/29/2015 156IIM Raipur
Growth Stage
• Umbrella brand with 3 variant spice, Lime,
Colongne
• Competition from other brands
• Increase in product line
1/29/2015 157IIM Raipur
Current stage
• Late maturity/ Early decline
• Tough Competition from other soap brands
• Sales declining
• Decrease in profit
1/29/2015 158IIM Raipur
Strategy- Cinthol
• Price range Rs 13 to 20
• More Deviant and variant
• Extensive Advertisement
1/29/2015 159IIM Raipur
IPHONE
1/29/2015 160IIM Raipur
iPhone
• Release dates:
– Original: June 29, 2007
– 3G: July 11, 2008
– 3GS: June 19, 2009
– 4: June 24, 2010
– 4s: October 14, 2011
– 5: September 21, 2012
1/29/2015 161IIM Raipur
iPhone
• Price Skimming
– iPhone priced at $599 at launch, but at $399 after
just 4 months of launch
• Releases a phone every year
1/29/2015 162IIM Raipur
iPhone Worldwide Sales
0
5
10
15
20
25
30
35
40
q3 2007 q4 2008 q1 2008 q2 2008 q3 2008 q4 2008 q1 2009 q2 2009 q3 2009 q4 2009 q1 2010 q2 2010 q3 2010 q4 2010 q1 2011 q2 2011 q3 2011 q4 2011 q1 2012 q2 2012 q3 2012 q4 2012
Series1 Poly. (Series1)
1/29/2015 163IIM Raipur
TATA INDICA
1/29/2015 164IIM Raipur
Indica- Evolution
• 1998 - Indica announced
• 2001 - Indica V2
• 2004 - Rejuvenated Indica V2
• 2005 - Indica V2 Turbo Diesel
• 2006 - Indica Xeta
• 2008 - Indica Vista
1/29/2015 165IIM Raipur
Tata Indica- YoY Sales, All India
0
20000
40000
60000
80000
100000
120000
140000
160000
2000 2001 2002 2003 2004 2005 2006 2007 2008
Sales YoY
Sales
1/29/2015 166IIM Raipur
Tata Indica Strategies
• In Growth Stage as of 2008.
1/29/2015 167IIM Raipur
Eternal Sunshine of the Spotless Mind
Movie Released- Mar ‘04
Movie DVD Released –Oct ‘04
1/29/2015 168IIM Raipur
The Bucket List
1/29/2015 169IIM Raipur
Million Dollar Baby
Movie Released- Dec ‘04
Movie DVD Released- Jul ‘05
1/29/2015 170IIM Raipur
The Pursuit of Happyness
Movie Released- Dec ‘06
Movie DVD Released- Nov ‘07
1/29/2015 171IIM Raipur
Pirates of the Carribean: Dead Man’s
Chest
Movie Released- Jul ‘06
Movie DVD Released- Nov ‘06
1/29/2015 172IIM Raipur
THANK YOU
1/29/2015 IIM Raipur 173

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Final

  • 1. Product Life Cycle- Stages and Strategies Vikas 12PGP050 Komal 12PGP Prateek 12PGP110 Srishti 12PGP043 Sourav 12PGP042 1/29/2015 IIM Raipur 1
  • 2. PLC- Overview • Every product has a life in a market. • Tenure of the life is uncertain. • Stages in PLC: 1/29/2015 2IIM Raipur
  • 3. PLC Implications • Products have a definite life period. • Product sales pass through distinct stages with each stage posing Challenges/Opportunities/ Problems. • Profits rise/fall during different stages of product life cycle. • Products require different marketing strategies at each stage 1/29/2015 3IIM Raipur
  • 4. PLC- Stages • Introductory Stage- Product just introduced in the market. • Growth Stage- Sales are rising. • Maturity Stage- Sales do not rise any further. • Decline Stage- Sales are falling. 1/29/2015 4IIM Raipur
  • 6. Introductory Growth Maturity Decline • Product has just been introduced in the market. • Product shows slow sales growth. • Profits are Low or negative as as RnD costs might have been incurred, also, no economies of scale advantage as low sales. • Little or no competetion faced • Pioneers adopt the product 1/29/2015 6IIM Raipur
  • 7. • Product: Basic • Distribution: Selective Introductory Growth Maturity Decline Price HIGH LOW HIGH Rapid Skimming Rapid Penetration LOW Slow Skimming Slow Penetration Pricing Promotion 1/29/2015 7IIM Raipur
  • 8. Rapid Skimming Strategy • new product is launched at high price with high promotion level • High price helps firm to recover max profits/ units. • High promo helps in customer awareness/ adoption. • This policy is fruitful under following conditions: – Large part of product market is unaware of product. – Those who become aware are eager to have it & can pay asked price. – Firm faces potential competition & wants to build brand preference. 1/29/2015 8IIM Raipur
  • 9. Slow Skimming Strategy • New Product launched at high price with low promotion. • High price helps firm to recover maximum profits /units. • Low promo keeps marketing expenses down. • Combination is expected to skip high profit from the market. • This strategy is used under following conditions – Market size is limited. – Market is aware of product. – Buyers are willing to pay high price. – Potential competition is not imminent. 1/29/2015 9IIM Raipur
  • 10. Rapid Penetration Strategy • New Product launched at low price with high promotion. • Helps to achieve: • Fastest market penetration. • Largest market share. • This strategy is used under following conditions – Market is large. – Market is unaware of the product. – Buyers are price sensitive. – Strong product competition exists. – Costs likely to decreases with volume. – Example: Reliance Hungama, Nirma, and Wheel 1/29/2015 10IIM Raipur
  • 11. Slow Penetration Strategy • New Product launched at low price with low promotion. • Low price encourages rapid product acceptance, • Low promotion cost helps retain profits. • This strategy is used under following conditions – If market is large. – If market is highly aware of product. – If market is price sensitive. – If market is minimally sensitive to promotion. – If Product competition exists. 1/29/2015 11IIM Raipur
  • 12. • Sales rising exponentially • Sales limited by production Capacity. • Profit increasing. • “Sales Pull” • Product Introductory Growth Maturity Decline 1/29/2015 12IIM Raipur
  • 13. Introductory Growth Maturity Decline Sales Costs Profits Marketing Objectives Rapidly rising sales Average cost per customer Rising profits Maximize market share 1/29/2015 13IIM Raipur
  • 14. Product Price Offer product extensions, service, warranty Price to penetrate market Distribution Build intensive distribution Advertising Build awareness and interest in the mass market Introductory Growth Maturity Decline 1/29/2015 14IIM Raipur
  • 15. Introductory Growth Maturity Decline Sales Costs Profits Marketing Objectives Peak sales Low cost per customer High profits Maximize profit while defending market share 1/29/2015 15IIM Raipur
  • 16. Product Price Diversify brand and models Price to match or best competitors Distribution Build more intensive distribution Advertising Stress brand differences and benefits Introductory Growth Maturity Decline 1/29/2015 16IIM Raipur
  • 17. Introductory Growth Maturity Decline Sales Costs Profits Marketing Objectives Declining sales Low cost per customer Declining profits Reduce expenditure and milk the brand 1/29/2015 17IIM Raipur
  • 18. Introductory Growth Maturity Decline Product Price Phase out weak items Cut price Distribution Go selective: phase out unprofitable outlets Advertising Reduce to level needed to retain hard-core loyal customers1/29/2015 18IIM Raipur
  • 19. PLC Variants- Style •PLC Graph is shown on the right. •Style is a basic/distinctive mode of expression appearing in a field of human endeavors. •Once a style is invented, it can last for generations, at times going in/ going out. •A style has a cycle showing several periods of renewed interest. Example: Styles appear in homes (colonial, ranch, transitional), Clothes(formal and casual) and art(realist, surrealist, abstract). 1/29/2015 19IIM Raipur
  • 20. PLC Variant- Fashion Fashion is a currently accepted/popular style in a given field. For Example: The more formal business attire Clothes: Jeans, Music: Hindi-Pop. - Fashion Pass through four Stages: •Distinctiveness Stage: Same customer take interest in something new that sets them apart. •Emulation Stage:Other customers take an interest out of desire to emulate fashion leaders. •Mass-Fashion Stage: Fashion becomes very popular & manufacturing gear up for mass production. •Decline: Consumer starts moving towards other fashion. 1/29/2015 20IIM Raipur
  • 21. PLC Variant- Fad Fads are those periods which have temporary unusually high sales driven by consumer enthusiasm. In this duration the product or brand gets immediate popularity. Some important points of fads are written below: •Fads is kind of fashion that comes quickly into the public eye. It gets adopted with great zeal, peak easily and decline fast too. •It has short acceptance cycle. •Fads tend to have limited followings •For Example: Pepsi Blue, Yo Bike, Pager. 1/29/2015 21IIM Raipur
  • 22. CASE LETS ON DIFFERENT MARKETING STRATEGIES 1/29/2015 22IIM Raipur
  • 24. Introduction Stage • Period duration of 1983-1986 • Maruti launched 1st 800 in Indian market in 1983 • Cheapest Car in Indian market • Also sold to countries of South Asia and South America market 1/29/2015 24IIM Raipur
  • 25. Marketing Strategy In Introduction Stage • Rapid Penetration Marketing Strategy was used in this stage. • Exported to countries like South Asia and South American market to increase number of customers. • Labeled as Cheapest car for Indian Market • Initially First car was presented to Lord Venkateshwara of Tirumala Venkateshwara Temple as Promotion 1/29/2015 25IIM Raipur
  • 26. Growth Stage • This stage is of the duration of 1987-1996 • Sales increased from about 63763 units to about 189061 units in 1996 • Different features were implemented in basic car model. 1/29/2015 26IIM Raipur
  • 27. Marketing Strategy Used in Growth Stage • Maruti 800 came up with new feature like AC version and music system • First export began in 1987 1/29/2015 27IIM Raipur
  • 28. Marketing Strategy In Maturity Stage • Maturity stage was for the duration of 1997-2002 • Launched revamped version of Maruti 800 EX, with new engine, • Entry of competitors like General Motors, Ford, Tata 1/29/2015 28IIM Raipur
  • 29. Marketing Strategy In Maturity Stage Contd. • Market share beaten by rivals like Hyundai Santro, Daewoo Matiz • Introduced LPG and CNG variabts, called Maruti 800 Duo with new 1/29/2015 29IIM Raipur
  • 30. Decline Stage • Period of range 2002-2012 • Sales of Maruti went down drastically from 1,51,976 units in the year 2000 to about 69,553 in 2007 • Buyers attracted by high end luxuries small cars • Sales volume is heavily beaten by competitors like Hyundai i10, Maruti Suzuki swift, Chevrolet Spark • In 2008-09 experienced sales of only 11,288 units1/29/2015 30IIM Raipur
  • 31. Marketing Strategy In Decline Stage • Stopped the production of Maruti 800 • Launched the new model maruti Alto 800 as replacement of maruti 800 1/29/2015 31IIM Raipur
  • 32. Product Life Cycle of Hero Honda CBZ 1/29/2015 32IIM Raipur
  • 33. Introduction Stage • Hero Honda CBZ was launched in early 1999 by Hero Honda Motors Ltd • It was the first sports oriented 4-stroke bike 1/29/2015 33IIM Raipur
  • 34. Marketing Strategy used In Introduction Stage • It has the feature of larger spring operated nozzle to provide a richer fuel air mixture in to engine for better acceleration. • Styling of bike was scaled version of famous Honda CB Series • It was labeled as Fast and Sport looking bike • Target market were young boys in the age 18-30 middle class. • Positioning were bikers who want to live life in extreme. 1/29/2015 34IIM Raipur
  • 35. Market Break-up 51% 26% 11% 3% 3% Sales Hero Honda Bajaj Yamha TVS OTHERS 1/29/2015 35IIM Raipur
  • 36. Growth Stage Contd.. • Sales increased in this stage for Honda CBZ • Promotion is increased in this stage to cope with competition. 1/29/2015 36IIM Raipur
  • 37. Product Life Cycle of Tata Nano 1/29/2015 37IIM Raipur
  • 38. Introduction Stage • Nano was launched in 2008 • Launched with basic model • The Cheapest car in the world • Initial Price Rs 1.26 lakhs on road 1/29/2015 38IIM Raipur
  • 39. Growth Stage • Nano is available in tree model ( Nano Basic, Nano CX and Nano LX) • Sale of Nano in June 2011 approximately 6515 1/29/2015 39IIM Raipur
  • 40. Marketing Strategy Used By Tata Nano • Tata motors share promotion of tata brand with its multiple bank partners. These financiers will promote the nano brand during booking jointly with tata motors • Tata marketing team used various media like radio, news on TV, online games, major website like facebook, orkut etc. 1/29/2015 40IIM Raipur
  • 41. Nokia Lumia • Nokia lumia a series of smart phone by • nokia • Based on window phone operating system • Deviant of Nokia lumia, Lumia 710,lumia 820, lumia 920 • Lumia 920 with 4 GB 1/29/2015 41IIM Raipur
  • 42. PLC Stage • Introduced in 2011 • Growth stage • Increasing sale 1/29/2015 42IIM Raipur
  • 43. Target market & Strategies- Lumia • Targeted for Heightened market • Rapid skimming strategy • High promotion 1/29/2015 43IIM Raipur
  • 44. Sony Bravia • Facility of HD input • Different Deviant from size range 56cms to 140 cms • Price range Available from Rs 15900 1/29/2015 44IIM Raipur
  • 45. PLC Stage • Launched in the year 2005 • Growth Stage • market share of 32% by value • sale of more than 35 thousand in December 2010 • growth of 46% comparing to previous year 1/29/2015 45IIM Raipur
  • 46. Target market • Targeted to the age group young generation the age group of 25-45 • Targeted Young family • Targeted to business related personal • Tag Line - More Bright. More Vivid. More Joy. 1/29/2015 46IIM Raipur
  • 47. Strategy • Concentration Strategy by targeting specific group • Differentiation strategy by offering unique value preposition • Rapid skimming Strategy 1/29/2015 47IIM Raipur
  • 48. Nokia 800 • 4.0-inch AMOLED Clear Black display with a 360 x 640 pixel resolution • 16GB internal storage • Memory expandable up to 32 GB via micro SD car • Bluetooth 3.0 with A2DP, USB 2.0 • 41 megapixel camera with Xenon flash, 1080p@30fps video recording 1/29/2015 48IIM Raipur
  • 49. PLC Stage • Launched in February 2012 • Introduction stage • High premium 24999 1/29/2015 49IIM Raipur
  • 50. Target Market • Yong urban male/female • Educated professional • Upper class People 1/29/2015 50IIM Raipur
  • 51. Strategy • High premium • Rapid Skimming 1/29/2015 51IIM Raipur
  • 52. Surf Excel • Product from HUL • Launched in 1954 • Created strong brand over the 5 decades • Market leader for 50 years 1/29/2015 52IIM Raipur
  • 55. PLC Stage • Maturity Stage • Competitors such as Nirma, Tide, Ghari, Ariel • 38% of detergent market 1/29/2015 55IIM Raipur
  • 56. Strategy • An emotional appeal by statement “Dag achhe hain” (dirt is good) • Extensive advertisement • Rational price • lot of Variant and deviant according to need 1/29/2015 56IIM Raipur
  • 60. Lux • World’s first beauty soap targeting upper class market • Launched in US in 1924 • Launched in India in 1929 • Initially, in India this product was launched in cities like Calcutta, Mumbai 1/29/2015 60IIM Raipur
  • 61. Introduction Stage: • Lux launched the world’s first mass-market beauty soap is the US in 1924 • First launched in India in 1929 • Lux over the world UK(1928), SRILANKA(1931), BRAZIL(1932) PAKISTAN(1957) etc • In this stage, LUX followed Rapid Skimming strategy. 1/29/2015 61IIM Raipur
  • 62. Maturity Stage • Lux product could be found in over 100 countries and they had the sales of 1.0 billion euros in 2005 • In this stage, few competitors enter into the market like (Cinthol, Fairglow, Santoor, Chandrika, Fiama Di Wills and Vivel) • Competition from its own brand Lifebuoy 1/29/2015 62IIM Raipur
  • 63. Marketing Strategies Used • Product: The lux has introduced various modified versions of the product like Lux Almond, Lux Orchid, Lux Fruit, Lux Saffron, Lux sandalwood, Lux Rose, Lux oil and Honey etc. • Price: The Lux products are now available at higher prices to maximize company profit. • Distribution: Lux has strong distribution across cities of India. • Advertising: In the latest campaign the Asit sin and kajal Aggarwal are used as their brand ambassador. • Promotional Offers: At times Lux has offered Buy3 get 1 Free offer to customers. 1/29/2015 63IIM Raipur
  • 64. Rapid Skimming Strategy • Product: Only one basic product without any variants/deviants/frills • Price: Relatively higher prices, to recover their initial cost of making the product • Place- Budget allocation was more for advertising, to attract more and more customers. • Distribution- was selective and only covering the major cities of India. 1/29/2015 64IIM Raipur
  • 65. Rapid Skimming Strategy • Promotion: Awareness marketing • Target Market: Upper class market – females 1/29/2015 65IIM Raipur
  • 66. Introductory Growth Maturity Decline Sales Costs Profits Market Low sales Higher cost per customer Negative or not very substabtial Pioneers, early adopters No competitorsCompetition 1/29/2015 66IIM Raipur
  • 67. Growth stage • In this stage, for LUX, main objective of LUX was to expand in India 1/29/2015 67IIM Raipur
  • 68. Marketing Strategy • Product: Only one basic product without any variants/deviants/frills • Price: Price Rationalization • Place- Budget allocation was more for advertising, to attract more and more customers. • Distribution- expanded the market and now covering the other cities of India as well. 1/29/2015 68IIM Raipur
  • 69. Marketing Strategy • Promotion: Affectation Realm (liking + preferences+ conviction) • Market: Pioneers, early adopters 1/29/2015 69IIM Raipur
  • 70. Introductory Maturity Decline Sales Costs Profits Market Higher sales, growth rate in sales is very high Average cost per customer Emerging Pioneers, early adopters NegligibleCompetition 1/29/2015 70IIM Raipur
  • 71. Maturity Stage • In this stage, LUX has expanded its market across India and objective now is to maximize and defend its market share. 1/29/2015 71IIM Raipur
  • 72. Marketing Strategy • Product: Product with many variants/deviants/frills- Lux Almond, Lux Orchid , Lux Fruit, Lux Saffron, Lux Sandalwood, Lux Rose, Lux International, Lux Chocolate, Lux Aromatic Extracts, Lux Oil and Honey etc • Price: Lux increased its prices to maximize the profit 1/29/2015 72IIM Raipur
  • 73. Marketing Strategy • Place- Budget allocation is reduced for advertising, because of the brand awareness in the minds of customers. • Distribution- Across India • Promotion: Incentives • Market: late majority 1/29/2015 73IIM Raipur
  • 74. Introductory Maturity Decline Sales Costs Profits Marketing Peak Sales, growth rate of sales=0 Low cost per customer Highest Profits maintenance marketing CINTHOL, FAIRGLOW,SANTOOR, CHANDRIKA, FIAMA DI WILLS and VIVEL Competition 1/29/2015 74IIM Raipur
  • 75. Decline • In-spite of all efforts, Lux is at the decline stage , • 1. Unilever products have presence in over 100countries worldwide thus currency fluctuations could play a major role. • For example in 2004, a 5.9% decline in turnover was primarily due to 4% appreciation in the average Euro exchange rate. 1/29/2015 75IIM Raipur
  • 76. • 2.In year 2008 – 09 due to economic recession in India and other countries, the sales of LUX got hit hard times. • 3.Other competition: Lux has been facing competition from HUL itself (Lifebuoy) & from other companies like:- Godrej Consumer Products : 1/29/2015 76IIM Raipur
  • 77. • GCPL, India’s second largest soap maker with 9.2% marketshare.•with leading brands such as • CINTHOL, FAIRGLOW & NIKHAR. • Fairglow brand, India's first Fairness soap, has created marketing history as one of the most successful innovation in soap industry. 1/29/2015 77IIM Raipur
  • 78. Marketing Strategy • Price: Lux increased its prices to maximize the profit • Place- Budget allocation is reduced for advertising, because of the brand awareness in the minds of customers. • Distribution- Across India • Promotion: Reduction in expenditures 1/29/2015 78IIM Raipur
  • 79. Introductory Maturity Decline Sales Costs Profits Marketing Forestalling Low cost per customer Loss, CM negative Reduction in expenditures CINTHOL, FAIRGLOW,SANTOOR, CHANDRIKA, FIAMA DI WILLS and VIVEL Competition 1/29/2015 79IIM Raipur
  • 80. Product Life Cycle Graph 1/29/2015 80IIM Raipur
  • 83. Oreo • Oreo was launched in 1912 in USA • Its production in USA is by Nabisco division of Kraft Foods. • Till now, Oreo is the best selling cookie in USA. 1/29/2015 83IIM Raipur
  • 84. Maturity Stage • Oreo cookie has reached the maturity stage in its life cycle, and the brand has appropriately taken several steps to prevent the cookie from fading out of America’s cookie jars. 1/29/2015 84IIM Raipur
  • 85. Marketing Strategy • Product: Leadership in cost, quality and market. Nabisco has launched many different flavors and varieties of the traditional cookie. Some of these include: Chocolate Crème Oreo, Golden Oreo Original, Fudge Covered Oreo, Fudge Mint Covered Oreo, Golden Oreo Chocolate Crème, 1/29/2015 85IIM Raipur
  • 86. • Double Delight Oreo Mint ‘n’ Crème, Double Delight Oreo Peanut Butter & Chocolate, Milk Chocolate Covered Oreo and Milk Chocolate Covered Mint Oreo. Additionally, Nabisco has released many Oreo baking supplies, such as Oreo Crumbs, Oreo Chocolate Cones, Oreo Jello Pudding… the list goes on. 1/29/2015 86IIM Raipur
  • 87. Marketing Strategy • Price: Its charges premium price due to its high price per gram 1/29/2015 87IIM Raipur
  • 88. • Place- Budget allocation is reduced for advertising, because of the brand awareness in the minds of customers. • Distribution- Across USA, Argentina, Canada, China, Croatia, Czech Republic, India, Italy, Norway, Poland, United Kingdom, Arab World 1/29/2015 88IIM Raipur
  • 89. Promotion- Oreo • With the introduction of new product lines under the Oreo name, the cookie is able to retain the old customers and target new customer base of kids. What Oreo is striving to create is an “Oreo consumer identity,” allowing the consumers to identify themselves by which Oreo suits their individual desires and tastes. 1/29/2015 89IIM Raipur
  • 90. Introductory Maturity Decline Sales Costs Profits Marketing Peak Sales, growth rate of sales=0 Low cost per customer Highest Profits maintenance marketing Sunshine Bakeries’ Hydrox cookies, Chips Cookies Competition 1/29/2015 90IIM Raipur
  • 91. Product Life Cycle Graph 1/29/2015 91IIM Raipur
  • 95. • Nestle Maggi Noodles is brand of instant noodles • This was launched in India in 1982 • Pioneer in instant noodles- 2minutes 1/29/2015 95IIM Raipur
  • 96. Introduction Stage • In this stage, Maggi Noodles followed Rapid Penetration strategy • It was found by the Maggi family in Switzerland in 19th century 1/29/2015 96IIM Raipur
  • 97. Growth stage • Few yrs back it enjoyed around 50% market share in this segment which was valued at around 250 crores. • during the 1990s, the sales of Maggi noodles declined, due to growing popularity of Top Ramen, and other noodles product • In order to improve sales ,NIL changed the formulation of Maggi noodles in 1997. • However, this proved to be a mistake, as consumers did not like the taste of the new noodles. • In March 1999, NIL reintroduced the old formulation of the noodles, after which thesales revived. Over the years, NIL also introduced several other products like soups and cooking aids under the Maggi brand. 1/29/2015 97IIM Raipur
  • 98. strategy • In latest Campaign Amitabh Bacchhan is narrating maggi tales of user. • New variants are launched with feedback from campaign “Me and MY Maggi” • Maggi also launched Guess the Taste Commercial 1/29/2015 98IIM Raipur
  • 99. Rapid Penetration Strategy • Product: Only one basic product without any variants/deviants/frills • Price: Relatively lower prices, to penetrate deeper and take the biggest of the market share. Cost plus 1/29/2015 99IIM Raipur
  • 100. Rapid Penetration Strategy • Place- Budget allocation was more for advertising, to attract more and more customers. • Distribution- was selective and only covering the major cities of India. • Promotion: Awareness marketing • Target Segment: Working Women and children 1/29/2015 100IIM Raipur
  • 101. Introductory Growth Maturity Decline Sales Costs Profits Market Low sales Higher cost per customer Negative or not very substantial Pioneers, early adopters No competitorsCompetition 1/29/2015 101IIM Raipur
  • 102. Growth Stage • In this stage, Maggi Noodles main objective was to expand in India 1/29/2015 102IIM Raipur
  • 103. Marketing Strategy • Product: New Product with frills- features, packaging, quality • Price: Price Rationalization • Place- Budget allocation was more for advertising, to attract more and more customers. 1/29/2015 103IIM Raipur
  • 104. Marketing Strategy • Distribution- expanded the market and now covering the other cities of India as well. • Promotion: Affectation Realm (liking + preferences+ conviction) 1/29/2015 104IIM Raipur
  • 105. Introductory Maturity Decline Sales Costs Profits Marketing Higher sales, growth rate in sales is very high Average cost per customer Emerging Pioneers, early adopters, 50% market share Top RamenCompetition 1/29/2015 105IIM Raipur
  • 106. Maturity Stage • In this stage, Maggi noodles have expanded its market across India and objective now is to maximize and defend its market share. 1/29/2015 106IIM Raipur
  • 107. Marketing Strategy • Price: Maggi noodles offered Rs 5 onwards • Place- Budget allocation is reduced for advertising, because of the brand awareness in the minds of customers. • Distribution- Across India , more intensive • Promotion: Incentives- Big Promotional Offers 1/29/2015 107IIM Raipur
  • 108. Introductory Maturity Decline Sales Costs Profits Marketing Peak Sales, growth rate of sales=0 Low cost per customer Highest Profits maintenance marketing Tough Rules of Competition for competitors like Top Ramen Competition 1/29/2015 108IIM Raipur
  • 109. Decline Stage: • Maggi noodles then faced decline stage 1/29/2015 109IIM Raipur
  • 110. Marketing Strategy • Product: New products launched but failed • Price: Price could not be lowered further • Place- Budget allocation is reduced for advertising, because of the brand awareness in the minds of customers. • Distribution- Across India, selective • Promotion: Reduction in expenditures 1/29/2015 110IIM Raipur
  • 111. Introductory Maturity Decline Sales Costs Profits Market Forestalling Low cost per customer Loss, CM negative Laggards Tough Competition from competitors Competition 1/29/2015 111IIM Raipur
  • 112. Rejuvenation • Strategy to counter decline: Re-launching • Maggi Noodles was launched again in 1999. 1/29/2015 112IIM Raipur
  • 113. Marketing Strategy • Price: Maggi noodles offered Rs 5 onwards • Place- Budget allocation is increased for advertising, new and interesting advertising campaigns • Distribution- Across India, more intensive • Promotion: Incentives- Big Promotional Offers • Market: Working Bachelors , children 1/29/2015 113IIM Raipur
  • 114. Product Life Cycle Graph 1/29/2015 114IIM Raipur
  • 118. • Nintendo WII released by Nintendo on November 19 , 2006. • It’s a home console for video game. • WII has many advanced features compared to previous Nintendo consoles. 1/29/2015 118IIM Raipur
  • 119. • WiiConnect24-enables it to receive messages and updates through internet even standby mode. • Nintendo Wii is the successor of Game Cube. • In late of 2011, Nintendo reconfigured the model – Wii Family Edition. • This edition was not compatible with Nintendo GameCube. 1/29/2015 119IIM Raipur
  • 120. Product Life Cycle • Maturity Stage 1/29/2015 120IIM Raipur
  • 121. Maturity Stage Product: • Motion Sensitivity • IR Sensors • Port to allow for a variety of Controller • Add ons • Classic controller can also be used for many WII 1/29/2015 121IIM Raipur
  • 122. Pricing: • $250- lower than while XBOX and Play-station 3 • Games cheaper than XBOX and Play-station 3 1/29/2015 122IIM Raipur
  • 123. • Promotion • 1.Mass selling • 2.Uses Intermediaries-GameStop, Hypermarket , Mall • 3.Push/Pull Techniques • Nintendo WII offers a free game and WIFI connection + updates. 1/29/2015 123IIM Raipur
  • 124. • Place: Distribution Centers across the globe. 1/29/2015 124IIM Raipur
  • 125. Introductory Maturity Decline Sales Costs Profits Marketing Peak Sales, growth rate of sales=0 Low cost per customer Highest Profits maintenance marketing Tough Rules of Competition for competitors like XBOX and Play- station 3 Competition 1/29/2015 125IIM Raipur
  • 126. Product Life Cycle Graph 1/29/2015 126IIM Raipur
  • 127. • Nokia 6600 1/29/2015 127IIM Raipur
  • 129. • This product when launched was the premium product of Nokia • It build the brand of Nokia • Most popular brand of Nokia 1/29/2015 129IIM Raipur
  • 130. Product Life Cycle • Decline stage • When Nokia 6600 was in decline stage, Nokia decided to stop its production • The product was blocked from production since 1997 1/29/2015 130IIM Raipur
  • 131. Marketing Strategy • Sales- sales were freely falling. • Market – Market now Laggards, which comprise of 16% of the market. • Profit-Loss, Contribution margin=Unit Selling Price –Unit Variable Cost becomes negative 1/29/2015 131IIM Raipur
  • 132. Strategy- Nokia • Strategy of the company: Closure • Nokia preferred to stop the production of the product because with price rationalization of Nokia 6600, within range of 4000-6000 and with the expandable memory and installation capacity, it occurred as a threat to the higher range mobiles of Nokia itself. 1/29/2015 132IIM Raipur
  • 133. Product Life Cycle Graph 1/29/2015 133IIM Raipur
  • 136. KFC • Kentucky Fried Chicken-is chain of fast food restaurants • They offer chicken with their special secret condiments recipe. • It entered into the market in 1954 in USA. 1/29/2015 136IIM Raipur
  • 137. Introduction stage • By early entry into the market, it managed to have strong name and strong control over the market. • They followed Rapid Skimming Strategy. 1/29/2015 137IIM Raipur
  • 138. Rapid Skimming Strategy • Product: Few basic product without any variants/deviants/frills • Price: Relatively higher prices, to recover their initial cost of making the product and also to take the advantage of being pioneers in fast food industry 1/29/2015 138IIM Raipur
  • 139. Rapid Skimming Strategy • Place- Budget allocation was more for door to door, to attract more and more customers and prospective franchises of USA • Distribution- was selective and only to franchises in USA • Promotion: Awareness marketing • Market: Upper Class 1/29/2015 139IIM Raipur
  • 140. Introductory Growth Maturity Decline Sales Costs Profits Market Low sales Higher cost per customer Negative or not very substantial Pioneers, early adopters No competitors in Chicken Products Competition 1/29/2015 140IIM Raipur
  • 141. Growth Stage • From 1970’s, 1980’s 1990’s , KFC followed an aggressive strategy of expanding it’s chain across the world 1/29/2015 141IIM Raipur
  • 142. Marketing Strategy • Product: More product with many variants/deviants/frills • Price: Relatively higher prices, to recover their initial cost of making the product and also to take the advantage of being pioneers in fast food industry 1/29/2015 142IIM Raipur
  • 143. Marketing Strategy • Place- Budget allocation was more for door to door, to attract more and more customers and prospective franchises of USA and outside USA • Distribution- was selective and only to franchises in USA • Promotion: Affectation Realm (liking + believability + conviction) • Market: Upper Class 1/29/2015 143IIM Raipur
  • 144. Introductory Maturity Decline Sales Costs Profits Market Higher sales, growth rate in sales is very high Average cost per customer Emerging Pioneers, early adopters Competitors like McDonaldsCompetition 1/29/2015 144IIM Raipur
  • 145. Maturity Stage • In this stage, KFC has expanded its market across and outside USA and objective now is to maximize and defend its market share 1/29/2015 145IIM Raipur
  • 146. Marketing Strategy • Product: Product with many variants/deviants/frills- Chicken wings, Popcorn Chicken, Veg Burgers, Zing kong box • Price: KFC rationalized its price to expand its market 1/29/2015 146IIM Raipur
  • 147. Marketing Strategy • Place- Budget allocation is reduced for advertising, because of the brand awareness in the minds of customers. • Distribution- Across and outside USA • Promotion: Incentives 1/29/2015 147IIM Raipur
  • 148. Introductory Maturity Decline Sales Costs Profits Marketing Peak Sales, growth rate of sales=0 Low cost per customer Highest Profits maintenance marketing Tough Rules of Competition from competitors like McDonalds Competition 1/29/2015 148IIM Raipur
  • 149. Decline Stage • KFC reaching decline stage because of too many competitors. But they added new features and packages, also new line of desserts to reintroduce their products and thus maintained their position 1/29/2015 149IIM Raipur
  • 150. Introductory Maturity Decline Sales Costs Profits Market Forestalling Low cost per customer Loss, CM negative Laggards Tough Competition from competitors Competition 1/29/2015 150IIM Raipur
  • 151. Strategy • After introduction of desserts line like Brownie Sundae and Crushers, KFC was again able to tap the market 1/29/2015 151IIM Raipur
  • 152. Marketing Strategy • Price: Price rationalized • Place- Budget allocation is reduced for advertising, because of the brand awareness in the minds of customers. • Distribution- Across USA and outside USA • Promotion: Reduction in expenditures • Market: Upper class as well as middle class, working bachelors 1/29/2015 152IIM Raipur
  • 153. • Sales: Higher sales, growth rate in sales is very high • Costs: Average cost of production/customer • Profit: Emerging • Marketing: Pioneers, early adopters, late adopters , laggards • Competitions- Competitors like McDonalds, Subway 1/29/2015 153IIM Raipur
  • 154. Product Life Cycle Graph 1/29/2015 154IIM Raipur
  • 156. Introduction stage • launched in the year 1952 • Positioned in the Premium soap segment • Positioned as a masculine brand 1/29/2015 156IIM Raipur
  • 157. Growth Stage • Umbrella brand with 3 variant spice, Lime, Colongne • Competition from other brands • Increase in product line 1/29/2015 157IIM Raipur
  • 158. Current stage • Late maturity/ Early decline • Tough Competition from other soap brands • Sales declining • Decrease in profit 1/29/2015 158IIM Raipur
  • 159. Strategy- Cinthol • Price range Rs 13 to 20 • More Deviant and variant • Extensive Advertisement 1/29/2015 159IIM Raipur
  • 161. iPhone • Release dates: – Original: June 29, 2007 – 3G: July 11, 2008 – 3GS: June 19, 2009 – 4: June 24, 2010 – 4s: October 14, 2011 – 5: September 21, 2012 1/29/2015 161IIM Raipur
  • 162. iPhone • Price Skimming – iPhone priced at $599 at launch, but at $399 after just 4 months of launch • Releases a phone every year 1/29/2015 162IIM Raipur
  • 163. iPhone Worldwide Sales 0 5 10 15 20 25 30 35 40 q3 2007 q4 2008 q1 2008 q2 2008 q3 2008 q4 2008 q1 2009 q2 2009 q3 2009 q4 2009 q1 2010 q2 2010 q3 2010 q4 2010 q1 2011 q2 2011 q3 2011 q4 2011 q1 2012 q2 2012 q3 2012 q4 2012 Series1 Poly. (Series1) 1/29/2015 163IIM Raipur
  • 165. Indica- Evolution • 1998 - Indica announced • 2001 - Indica V2 • 2004 - Rejuvenated Indica V2 • 2005 - Indica V2 Turbo Diesel • 2006 - Indica Xeta • 2008 - Indica Vista 1/29/2015 165IIM Raipur
  • 166. Tata Indica- YoY Sales, All India 0 20000 40000 60000 80000 100000 120000 140000 160000 2000 2001 2002 2003 2004 2005 2006 2007 2008 Sales YoY Sales 1/29/2015 166IIM Raipur
  • 167. Tata Indica Strategies • In Growth Stage as of 2008. 1/29/2015 167IIM Raipur
  • 168. Eternal Sunshine of the Spotless Mind Movie Released- Mar ‘04 Movie DVD Released –Oct ‘04 1/29/2015 168IIM Raipur
  • 169. The Bucket List 1/29/2015 169IIM Raipur
  • 170. Million Dollar Baby Movie Released- Dec ‘04 Movie DVD Released- Jul ‘05 1/29/2015 170IIM Raipur
  • 171. The Pursuit of Happyness Movie Released- Dec ‘06 Movie DVD Released- Nov ‘07 1/29/2015 171IIM Raipur
  • 172. Pirates of the Carribean: Dead Man’s Chest Movie Released- Jul ‘06 Movie DVD Released- Nov ‘06 1/29/2015 172IIM Raipur
  • 173. THANK YOU 1/29/2015 IIM Raipur 173