product life cycle

Paramjit Sharma

Paramjit Sharma

ProductLifeCycle

The Concept

Products Have Limited Life

Product Sales Pass Through Different Stages

Profits varies at Different Stages Of PLC’s

Products Require Different Strategies at Each Stage

Paramjit Sharma

Paramjit Sharma

Paramjit Sharma

ProductLifeCycle

PLC Stages

Introduction

Growth

Maturity

Decline

Paramjit Sharma

ProductLifeCycle

PLC Stages

Paramjit Sharma

ProductLifeCycle

PLC Stages

FaxCell PhonesBottled Water

Type WritersNews Papers

Type Writers

Paramjit Sharma

ProductLifeCycle

PLC-other Patterns

1. Growth-Slump –Maturity Pattern

2. Cycle-Recycle Pattern

3. Scalloped PLC

Not All ProductsExhibits

Bell ShapedPLC

Paramjit Sharma

ProductLifeCycle

PLC-other Patterns

Paramjit Sharma

ProductLifeCycle

Style ,FashionAnd Fad Life Cycle

1.Style- Distinctive mode Of Expression

2.Fashion- Popular Style In Given Field

3.Fad- Fashions that disappear Quickly

Housing( Colonial)

4 Characteristics- Distinctiveness, emulation, mass following ,decline

Rapid Acceptance & Decline

Paramjit Sharma

ProductLifeCycle

Style ,FashionAnd Fad Life Cycle

Paramjit Sharma

ProductLifeCycle

Marketing Strategies--Introduction

Slow GrowthExpansion Of Production CapacityTechnical ProblemsDistribution NetworkCustomer ReluctanceProfits-Low/Negative

Paramjit Sharma

ProductLifeCycle

Marketing Strategies- introduction

One Of The 4 strategies Can Be Pursued

Rapid Skimming

Slow Skimming

Rapid Penetration

Slow Penetration

Paramjit Sharma

ProductLifeCycle

Marketing Strategies-growth

Improve Product quality, add features , improve styling

Adds new Models and flanker Products (New Features)

Enters New Market Segments

Enters New Distribution Channels

Shifts Adv. From Product Awareness to Product Preference

Lowers Prices To Attract next Layer

Paramjit Sharma

ProductLifeCycle

Marketing Strategies-maturity

Maturity Stages

1.Growth Maturity –Sales Start Declining

2.Stable Maturity - Saturation

3.Decaying Maturity –Absolute Level Decline Customers Start Switching

Paramjit Sharma

ProductLifeCycle

Marketing Strategies-maturity

Sales Slow Down Leads To

• Competition• Overcapacity• Increase In Promotion• Weak Competitors Withdraw• Giants Firms Dominate• Some Nichers• High Volume-Low Cost• Some Abandon Low Cost

Paramjit Sharma

ProductLifeCycle

Marketing Strategies- maturity

Market ModificationVolume =no of brand users * Usage Rate Per User

Brand Users Can Be Expanded By

1. Convert Non Users 4 Frequent Use-Juice

2. Enter New Segments 5 Using More -Shampoo

3. Win Competitors 6 New Uses— Food Recipes Customers

Paramjit Sharma

ProductLifeCycle

Marketing Strategies- maturity

Product Modification — Modifying product Characteristics through quality ,feature ,Style Improvement

Quality Improvement

DurabilityReliabilitySpeedTaste

Stronger, Bigger, Plus

Feature Improvement

SizeWeightMaterialsAccessories

Safety, Versatilityconvenience

Style Improvement

AestheticAppeal

Restyling Packaging,New Models of Cars

Paramjit Sharma

ProductLifeCycle

Marketing Strategies- maturity

Marketing Mix ModificationPriceCuts, DiscountsSpl. OccasionsCredit TermsIncrease Price & Quality

Distribution

More OutletsNew Distribution Channels

•Increasing Exp•Message•Timing•Frequency

Advertising

Sales Promotion

Stepping Up Or Reducing

Personal Selling

Quality Of Sales ForceSales Territories

Services

SpeedTech. Assistance

Paramjit Sharma

ProductLifeCycle

Marketing Strategies- Decline

Sales Decline May Be slow May Be Rapid May Reach Zero May Petrify at Low Level

Paramjit Sharma

ProductLifeCycle

Marketing Strategies- Decline

DeclineIn Sales

•Tech. Advance

•Shifts In Taste

•Competition

•Leads to

•Overcapacity•Price Cutting•Profit Erosion

Paramjit Sharma

ProductLifeCycle

Marketing Strategies- Decline

SalesDecline

Leads To

ReduceNumber OfProducts

Withdraw From

Cut AdvExpenses

WeakTrade

Channels

Small Firms

Remai

ning

Firms

SmallerMarket

Segments

Withdraw

Paramjit Sharma

ProductLifeCycle

Marketing Strategies- Decline

AgeingProducts

Hidden Costs

Waste Of Management TimeFrequent Price AdjustmentsShort Production RunAttention On Adv & Sales PromotionCast Shadow On Company’s ImageDelay Replacement of Product

Paramjit Sharma

ProductLifeCycle

Marketing Strategies- Decline

AgeingProducts

Handling

•System To Identify Weak Products

•Establising Review Committee

•Recommendation Of RC

•Finding Exit Barriers

Paramjit Sharma

ProductLifeCycle

Marketing Strategies- Decline

Harrigan,s Strategies

Increasing Investments to Dominate

Maintaining till Uncertainties

Dropping Unprofitable Customer Groups

Harvesting (Milking)

Divesting

Paramjit Sharma

ProductLifeCycle

Marketing Strategies- Decline

Harvesting

Gradually Reducing Product Cost

Reduce Product Cost, Sales Force

Services, Advertisement……

Paramjit Sharma

ProductLifeCycle

Marketing Strategies- Decline

Divest - Looking For Buyers

Restage OrRejuvenate –

Adding Value To Original Product

Paramjit Sharma

Too VariableIn shape &Duration

No Fixed SequenceOfStages

No FixedLength Of

Stages

Difficult To AnticipateCurrentStage

Paramjit Sharma