1. Sustaining Product Sales Section 30.2

2. Objectives Identify the four stages of the product life cycle. Describe product positioning techniques.

3. Product Life Cycle Stages that a product goes through during its life Must adjust product mix and strategies 4 stages Introduction, Growth, Maturity, Decline

4. Product Life Cycle

5. Introduction Stage Company focused on promotion and production. Major goal; customer attention. Build sales by increasing product awareness. Special promotion Costs are high

6. Growth Stage Product successful Increase sales and profits Target market knows about product Advertising: Customer Satisfaction Offers new/ modified products to continue sales

7. Maturity Stage Sales level off or slow down Very competitive Household name High advertising expense

8. Decline Stage Sales fall Profits less than costs Use product mix strategies to boost sales

9. Product Mix Strategies Sell or License the Product Recommit to the Product Line Discount the Product Regionalize the Product Modernize or Alter the Product Offering

10. Product Positioning Image product projects Goal: Set the product apart from competition Identify, Place and Sell product in marketplace Identify customer needs and determine competition

11. Positioning by Price and Quality Economy line, mid- priced line, and luxury line High price=quality Low price=value Ex. Ford

12. Positioning by Features and Benefits Done with customer wants and needs in mind Based on research Market segmentation Ex. OT, personal care products for boys ages 9 to 16

13. Positioning in Relation to the Competition Direct competition Solidify advantage over firm Not the best idea Ex. Southwest Airlines

14. Positioning in Relation to Other Products in a Line Individual products in relation to other products within line Ex: Palm Pilot

15. Category Management Process involves managing product categories as individual business units Group of product lines with same target market Retailers/Manufactures focus on customer needs

16. Planograms Computer-developed diagram that shows retailers how products should be displayed on a shelf Maximize product’s potential Highlights other items used with product Customizable to customer needs

17. Assignment Review and summarize Newsweek article. Be sure to answer the following questions: 1.What stage of the product life cycle is Starbucks coffee? Explain and provide detail… 2.What product positioning strategy is Starbucks implementing? 3.Do you believe Starbucks will be successful in boosting sales?