What marketing strategies are appropriate at each stage ?
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What marketing strategies are appropriate at each stage ? based on kotler chapter 8
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What marketing strategies are appropriate at each stage ?
- 1. What marketing strategies are appropriate at each stage of the product life cycle? A company's positioning and differentiation strategy must change as the product, market, and competitors change over the product life cycle
- 3. Introductory stage there will most-likely be heavy promotional and advertising activity designed to raise awareness of the new product, and to seek sales amongst early adopters
- 4. Introduction Stage of the PLC Sales Costs Profits Marketing Objectives Product Price Low sales High cost per customer Negative Create product awareness and trial Offer a basic product Use cost-plus Distribution Build selective distribution Advertising Build product awareness among early adopters and dealers
- 5. Strategic focus • Inform potential customers • Induce product trial • Secure distribution in retail outlets
- 6. Growth stage • The growth stage is typically characterized by a strong growth in sales and profits. This makes it possible for businesses to invest more money in the promotional activity to maximize the potential of this growth stage.
- 7. Sales Costs Profits Marketing Objectives Product Price Rapidly rising sales Average cost per customer Rising profits Maximize market share Offer product extensions, service, warranty Price to penetrate market Distribution Build intensive distribution Advertising Build awareness and interest in the mass market Growth Stage of the PLC
- 8. Strategic focus • Persuasive advertising must be used • Maximize Market Share
- 9. Maturity stage • During the maturity stage, the product is established and the aim for the manufacturer is now to maintain the market share they have built up.
- 10. Sales Costs Profits Marketing Objectives Product Price Peak sales Low cost per customer High profits Maximize profit while defending market share Diversify brand and models Price to match or best competitors Distribution Build more intensive distribution Advertising Stress brand differences and benefits Maturity Stage of the PLC
- 11. Strategic focus • Develop and maintain brand loyalty • Competitive or promotional price may be used • Maximize profit while defending market share
- 12. Decline stage • the market for a product starts to shrink, and this is what’s known as the decline stage as the market starts getting saturated or people start shifting to different products.
- 13. Sales Costs Profits Marketing Objectives Product Price Declining sales Low cost per customer Declining profits Reduce expenditure and milk the brand Phase out weak items Cut price Distribution Go selective: phase out unprofitable outlets Advertising Reduce to level needed to retain hard-core loyal customers Decline Stage of the PLC
- 14. Strategic focus • Decide upon which product models are to be kept and which ones are to phased out • Reduce expenditure and milk the brand • Lessen advertising and retain loyal customers
- 15. Summary
Editor's Notes
- Introduction. In this stage marketers spend heavily on promotions to inform the target market about the new product's benefits. Low or negative profits may encourage the company to price the product high to help offset expenses. companies can concentrate on skimming strategies to generate high profits now or on penetration strategies to build market share and dominant the market for larger profits once the market stabilizes.
- Product Life-Cycle Strategies This CTR relates to the material on pp. 289-290 and 293.
- Product Life Cycle Strategies Maturity. In this stage the company must manage slower growth over a longer period of time. Strategic decisions made in the growth stage may limit choices now. Marketing managers must proactively seek advantage by either market modification to increase consumption, product modification to attract new users (quality, feature, and style improvements), or marketing mix modification in an attempt to improve competitive position.
- Product Life-Cycle Strategies This CTR relates to the material on pp. 292-293.