Product Life Cycle

Product Design Product Item – specific model or size of a product Product Classification Consumer Goods – are purchased and use by the ultimate consumer for personal use Business Goods – are purchased by organizations for use in their operation Point of Difference – a difference in a product that makes it stand out from another product.

New Product Development Step 1 – SWOT Analysis Strengths Weaknesses External Opportunities Threats Step 2 – Idea Generation Step 3 – Screening and Evaluation Step 4 – Business Analysis Step 5 – Development Step 6 – Test Marketing Step 7 - Commercialization

Stages

Introduction Focus on promotion and production Promotion trying to get new customers Least profitable stage Establish market and build demand

Marketing Mix for Introduction Product-one or few product lines Pricing Skim Pricing-recoup costs – starts high Penetration Pricing-gain high market share – starts low Distribution-scattered, working on plan Promotion-build brand awareness, samples or trial incentives

Growth Increasing sales and profits Much of the target market knows about and buys the product Shift advertising to focus on customer satisfaction Much competition Introduce new models to offer more

Marketing Mix for Growth Product-new features, packaging, increase quality Pricing Skim Pricing Monitor Sales Reduce price to appeal to next target market Penetration Pricing Very little price change Use promotions to keep sales high Distribution-expand Promotion-increase advertising to build brand satisfaction.

Maturity Sales level off or slow down Most competition Most of the target market owns the product Marketing efforts fight off competition Stretch the life of the product

Marketing Mix for Maturity Product-modifications made to differentiate from competition Look to new uses to hold prices Price-possible price reductions in response to competition Distribution-new channels and incentives Look to emerging markets to sell to Promotion-build brand loyalty, incentives to get others to switch

Decline Sales fall and profits decrease Could be losing money on product Reduce marketing efforts Once no longer profitable=phased out

Marketing Mix for Decline Product-reduce products in line, rejuvenate survivors to look new Price-lowered to get rid of inventory, maintain if there is a niche Distribution-selective, unprofitable channels phased out Promotion-reinforce brand image

PLC Song Step 1: Read through notes Step 2 Think of a product that has gone through several steps of the PLC (doesn’t have to be in decline) Step 3: Think of song Step 4: Replace the lyrics of a favorite song with the life experience of your product. Be creative and have fun!!!

Stages

What stage is this product in?