Product life cycle

sales

profits

introduction growth maturity decline

Product life cycle

• Introduction • Growth• Maturity• Decline

Introduction • Firms seeks to build a product awareness and develop

a market for the product. The impact of marketing mix:• Product branding and quality level is established and

intellectual property protections like patents , copy rights etc are obtained

• Pricing may be low penetration pricing to build market share rapidly and high skim pricing to recover development cost

• Distribution is selective until the customers show the acceptance of the product

• Promotion is aimed at innovators and early adopters

Marketing strategy: introduction stage• Profits are negative /low • Promotional expenditure are at their highest ratio

to sales• Decide when to enter the market– To be first– To come in later

• Market pioneer advantage

Growth• Firms seeks to build brand preference and increase

market share.• Product quality is maintained and additional

features and support services may be added • Pricing is maintained as the firm enjoys increasing

demand with little competition• Distribution channels are added as demand

increases and customers accept the product• Promotion is aimed at broader audience

Marketing strategy : Growth stage

• Improves product quality and styling• Add new product features and models• Enter new market segment• Enter new distribution channel• Product preference advertising

Maturity• Strong growth in sales diminishes. To defend

market share while maximizing profits .• Product may be enhanced to differentiate the

product from that of competitors• Pricing may be lower because of new competition• Distribution is more intensive and incentives may

be offered to encourage preference over competing products

• Promotion emphasis product differentiation

Marketing strategy : maturity stage

• Market modification – Expand number of brand users– Increase the usage rate per user

Marketing strategy : maturity stage

• Product modification–Quality improvement–Feature improvement–Style improvement

Marketing strategy : maturity stage

• Marketing program modification–Price–Distribution–Advertising– Sales promotion–Personal selling – services

Decline

• Maintain the product• Harvest the product• Discontinue the product