principle of Marketing Lecture...-26.ppt
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The document discusses the product life cycle (PLC), outlining its five stages: product development, introduction, growth, maturity, and decline, and emphasizes that not all products follow these stages uniformly. It describes the characteristics, sales, costs, and marketing objectives associated with each stage, such as low sales and high costs in the introduction phase versus peak sales and high profits in maturity. Strategies for extending the product life cycle, including market and product modifications, are also presented.
principle of Marketing Lecture...-26.ppt
- 4. Today’s Topics Product Life Cycle (PLC)
- 5. Time Product Development Stage Introduction Profits Sales Growth Maturity Decline Sales and Profits ($) Sales and Profits Over the Product’s Life From Inception to Demise Product Life-Cycle (PLC)
- 6. The Typical Product Life Cycle (PLC) Has Five Stages – Product Development, Introduction, Growth, Maturity, Decline – Not all products follow this cycle
- 7. The four basic stages through which a successful product progresses-introduction, growth, maturity, and decline. Some products move rapidly through the product life cycle, while others pass through those stages over long time periods.
- 9. Time Product Development Stage Introduction Profits Sales Growth Maturity Decline Sales and Profits ($) Sales and Profits Over the Product’s Life From Inception to Demise Product Development Stage
- 10. Product development Introduction Growth Maturity Decline Begins when the company develops a new-product idea Sales are zero Investment costs are high Profits are negative PLC Stages
- 12. Time Product Development Stage Introduction Profits Sales Growth Maturity Decline Sales and Profits ($) Sales and Profits Over the Product’s Life From Inception to Demise
- 13. Product development Introduction Growth Maturity Decline Low sales High cost per customer acquired Negative profits Innovators are targeted Little competition PLC Stages
- 14. Sales Costs Profits Marketing Objectives Product Price Low sales High cost per customer Negative Create product awareness and trial Offer a basic product Use cost-plus Distribution Build selective distribution Advertising Build product awareness among early adopters and dealers
- 15. Growth Stage
- 16. Time Product Development Stage Introduction Profits Sales Growth Maturity Decline Sales and Profits ($) Sales and Profits Over the Product’s Life From Inception to Demise
- 17. Product development Introduction Growth Maturity Decline Rapidly rising sales Average cost per customer Rising profits Early adopters are targeted Growing competition PLC Stages
- 18. 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
- 19. Time Product Development Stage Introduction Profits Sales Growth Maturity Decline Sales and Profits ($) Sales and Profits Over the Product’s Life From Inception to Demise Maturity Stage
- 20. Product development Introduction Growth Maturity Decline Sales peak Low cost per customer High profits Middle majority are targeted Competition begins to decline PLC Stages
- 21. Sales Costs Profits Marketing Objectives Product Price Peak sales Low cost per customer High profits Maximize profit while defending market share Diversify brand and models Price to match or best competitors Distribution Build more intensive distribution Advertising Stress brand differences and benefits
- 22. Decline Stage
- 23. Time Product Development Stage Introduction Profits Sales Growth Maturity Decline Sales and Profits ($) Sales and Profits Over the Product’s Life From Inception to Demise
- 24. Product development Introduction Growth Maturity Decline Declining sales Low cost per customer Declining profits Laggards are targeted Declining competition PLC Stages
- 25. 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
- 26. Overlap of Life Cycle for Products A and B
- 27. WINDOWS 95 1991 1995 1996 1997 WINDOWS 3.1
- 28. Extending the Product Life Cycle
- 29. 1. Increase frequency of use by present customers 2. Add new users 3. Find new uses 4. Change product quality or packaging Market Modification Product Modification
- 30. To prevent the product going into decline you modify the product Adding new features, variations, model varieties will change the consumer reaction - create more demand therefore you attract more users
- 31. Enough for today. . .