She earned her Bachelor of Science degree in marketing and multinational business from Florida State University and a Master of Business Administration from Nova Southeastern University. It is really interesting and thought provoking exercise of logic to travel through the stages of product life-cycle. It is quite possible that a product might cross the first and at the most second stage and die a premature death just as many human beings do. It attracts the price conscious segment and retain the customers. Certainly, there are some famous brands and products that are still in the maturity stage after thirty years and more. Wrap-Up: Characteristics of the Product Life Cycle Stages and their Marketing Implications The table below provides a summary of the characteristics of the product life cycle stages and the appropriate marketing responses for each stage.
Usually, they offer the product at a much lower sales price. This behaviour was evident for instance when the manufacturers of the first smartphones targeted B2B customers when the products were first introduced to the market. The cycle describes how a product matures and declines as a result of internationalization. For every subject you can now access each digital resource as soon as it is ordered. In this stage, sales will usually lift off. Promotional programs are more essential in this phase.
Phased withdrawal provides the advantage of enabling the firm to plan the introduction of replacement products. This is why the product is sold at record low prices. Ultimately, much like living beings, they will decline and get phased out. It has an advantage of low margin over broad-based turnover. In response to this, rather than continuing to add new features to the product, the corporation focuses on driving down the cost of the process to manufacture the product. The marketing mix during this stage of the product life cycle entails strategies to establish a market and create a demand for the product.
Place Distribution at this stage is usually selective and scattered. Different products have different properties so their life cycle also vary. Marketing mix decisions include: product At maturity stage, companies add features and modify the product in order to compete in market and differentiate the product from competition. What can the healthcare industry learn from such an approach? Sometimes managerial decisions affect the life of products in this case Product Life Cycle is not playing any role. Journal of International Economics, 21 3 , 269-284. Distribution channels are increased and promotion is aimed at a wider audience. In the modern business environment, the rapid implementation and adoption of technology are shortening the product life cycles dramatically.
Product Standardization Exports to nations with a less developed economy begin in earnest. In Recent times, better opportunities have been created by available technologies for substantially profitable investment of resources. This makes it possible for businesses to invest more money in the promotional activity to maximize the potential of this growth stage. This shrinkage could be due to the market becoming saturated i. She has been published in Security Management, American Indian Report and Tech Republic. However, when the demand for their product starts to increase, and the company moves into the Growth phase of the product life cycle, they are likely to face increased competition as new manufacturers look to benefit from a new, developing market.
Lesser amount is spent on the promotion aspect and if any product line is not profitable for a business, it liquidates its non profitable product line and keeps only potential products. Liquid Crystal Displays used for example, in calculators and watches. If new product is appealing to consumer and no stiff competition is out there, company can charge high prices and earn high profits. Successful companies will usually begin to modify the product with new tech or new applications to gain a competitive advantage. This is the stage where the marketing mix and marketing efforts decline. Their existing products may be sold or discontinued.
Want to become a sector or industry specialist? That is, alternatively, interest in the product may fade, leading to a rapid reduction in sales. Popularizing vitamin B capsules as a regular intake than as a curative dose. During the maturity stage, the firm can choose from a number of alternative strategies to ensure the future success of the product. If the product remains in demand for a long period of time, and the cost of production steadily declines, its life will be longer. An increase in the number of distribution outlets tends to go in hand with this. Product Life Cycle Management The standard Product Life Cycle Curve typically shows that profits are at their highest during the Growth stage.
In healthcare, simply by monitoring a products or services life cycle, management can better plan when to introduce a new service or product. This will always be the latest edition of each resource too and we'll update you automatically if there is an upgraded version to use. The most important point is to get it right the first time. Decline The decline phase refers to the period when the product reaches its saturation point. By cash cows I mean firms having consistent cash flows, dividends and low risk levels. Sales continue to increase but at a slower rate. Price Because of intense competition, at maturity stage, price is reduced in order to compete.
Also, the company will start looking for other commercial opportunities such as adaptations or innovations to the product and the production of by-products. Okoye's interests include empowering under-served communities globally, bridging access to and the delivery of healthcare services. To offset the impact of low sales, corporations will keep the manufacture of the product local, so that as process issues arise or a need to modify the product in its infancy stage presents itself, changes can be implemented without too much risk and without wasting time. Over production appears to be the major problem. While this decline may be inevitable, it may still be possible for companies to make some profit by switching to less-expensive production methods and cheaper markets.
This is often caused by a lack of understanding of the characteristics of the product life cycle stages and their implication on the required marketing strategies. This makes the originators to further improve the product and bring down the price to nab competition. Promotion At introductory stage, promotion is done with intention to build brand awareness. The most common reason is that the market has become saturated i. It is stages where the market for the product has been superseded by a technological or style change which replaces the existing demand altogether.