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Product decisionsProduct life cycle(PLC)
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• Concept of Product life cycle(PLC)
• Stages of PLC-
1. Introduction stage
2.Growth stage
3.Maturity stage
4.Decline stage
• Marketing strategies in every stage of PLC• Examples
Content of topic (PLC)
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Product Life Cycle
• product life cycle is the course of a
product’s sales and profits over time.
• product life cycle (PLC) deals with the
life of a product in the market with
respect to business or commercial costs
and sales measures.
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Time
ProductDevelop-ment
Introduction
Profits
Sales
Growth Maturity Decline
Sales andProfits
Sales and Profits Over the Product’s Lifetime
Product Life Cycle & Its Stages
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Sales
Costs
Profits
Marketing Objectives
Product
Price
Low
High cost per customer
Negative
Create product awareness and trial
Offer a basic product
Firm normally chooses Pricing strategy - mkt.penetration or mkt. skimming.
DistributionFew and selective distribution, securedistribution in retail outlets
Promotion High advertising, high promotion
Summary of Strategies-
Introduction Stage of the PLC
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Examples
1.T-series mobiles
2.Horlicks foodles3.TVS Wego
4.TVS jive
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5.Micra Car
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Sales
Costs
Profits
Marketing Objectives
Product
Price
Gradually rising
Average cost per customer
Gradually risingImprove pdt . quality, add new features,enter into new mkt segments, new D.C.
Offer extension, service, warranty
To persuade marketers brand Suitable pricing strategy & D.C.choice, price is slightly lowered to attract the next layer of pricesensitive buyers
Distribution Build intensive distribution
Promotion Slightly raised or remain the same ,to build faith
Summary of Strategies-
Growth Stage of the PLC
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Examples
• Vim liquid dishwasher
• Dettol handwash
• Hippo
• Knor ready to cook
•CBZ extreme
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Sales
Costs
Profits
Marketing Objectives
Product
Price
Peak
Low cost per customer
High
Maximize profits while defending market share
Diversify brand and models
Match or best competitors
DistributionBuild more intensive ,selective, exclusivedistribution
PromotionIt should be cost effective to hold existing
customers
Summary of Strategies
Maturity Stage of the PLC
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Marketing strategies during Maturity phase
1. Convert nonusers to users- e.g. All out tried to convert
mosquito repellant mat users to liquid vapourisers.
2. Enter new mkt. segments – L&T looking for overseas
market.
3. Win competitors customers- Pepsi & Coca-cola
4. More frequent use by suggesting various occasions of
the use of the product- SONATA Watches, Dairy Milk,
Amul Butter
5. More usage per occasion.
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6. New & more varied uses of the same product- Milkmaid
apart from its use in tea & coffee can also be used as
ingredient of sweets.
7.Product modifications by increasing the functional
performance- Change in flavours like Maggi Tomato
sauce, plain, with chilli, etc.
8.Improving style-
9. S/C augmentation, image mktg. , & carving out a niche
within a specific mkt. segment become the critical tools
to retain the competitive edge.
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Examples
• Scooty pep
• Splendor plus
• Colgate
• Cadbury
•Amul dairy products
• Lux soap
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Sales
Costs
Profits
Marketing Objectives
Product
Price
Declining
Low cost per customer
Declining
Reduce expenditures and milk the brand
Phase out weak items
Cut price
Distribution Selective: phase out unprofitable outlets
Promotion Reduce to minimum level
Summary of Strategies-
Decline Stage of the PLC
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Example
• Fanta apple
• Hero honda glamour
• TVS flame
• TVS victor
•
Nirma beauty soap
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Stage 1: Introduction
• Launched in India in 1982 keeping in mind
working population.
• women and children.
• Low Price
• “BAS 2 MINUTE”
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Stage 2: Growth
• Sales Increased
• 50% Market Share
• No 1 Brand
• “GOOD TO EAT FAST TO COOK
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Stage 3: Maturity
• Introduced new Variety
• Price Rs 5 Onwards
• Big Time Promotional Offers
•Slow Down In Sales
• Market Saturation
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Stage 4: Decline
• Big Time Downfall in Sales
• Formulation Changed
• New products launched
•Failure
• Entry of a Competitor