MAHAJAN SAMANT

PRODUCT LIFE CYCLE STRATEGIES

INDO GERMAN TRAINING CENTRE

MAHAJAN SAMANT

PRODUCT LIFE CYCLE STRATEGIES

To assert four things :

Product has P.L.C.

1) Products have limited life. 2) Product Sales Passes through distinct stages. 3) Profits rise and fall at different stages. 4) Products require different functional strategies.
INDO GERMAN TRAINING CENTRE

MAHAJAN SAMANT

PRODUCT LIFE CYCLE STRATEGIES

Sales Sales & Profits

Profit

Decline Introduction Growth Maturity

Time

INDO GERMAN TRAINING CENTRE

MAHAJAN SAMANT

PRODUCT LIFE CYCLE STRATEGIES

Growth Slump Maturity Pattern* S a l e s {Kitchen Appliances} V o l u m e Cycle Recycle Pattern* S a l e s {New Drugs} V o l u m e Scattered Pattern*

S a l e s V o l u m e

{Nylon Fibre}

Time

* 6 to 17 different patterns
Cigarette
Filtered

Time

Time

Product Category. . . . . . . . . Liquor

Product Form. . . . . . . . . . . . White Liquor A product. . . . . . . . . . . . . . .Vodka

White or Colour

INDO GERMAN TRAINING CENTRE

MAHAJAN SAMANT

PRODUCT LIFE CYCLE STRATEGIES

STYLE S a l e s V o l u m e S a l e s V o l u m e FASHION S a l e s V o l u m e FAD

Time

Time

Time

Home Dcor Clothing Art {Budgeting, Costing Methods}

Saree Dress Material Jewellery {2BB}

Stitch Shirts Bell Bottom Trousers

{FEMM}

INDO GERMAN TRAINING CENTRE

MAHAJAN SAMANT

PRODUCT LIFE CYCLE STRATEGIES

I. Introduction Stage
1. 2. 3. Inform potential consumer. Induce product trial. Secure distribution in retail. Profits ve OR Low. Promotion High Low High Low

Rapid Skimming Slow Skimming Rapid Penetration Slow Penetration

Price High High Low Low

INDO GERMAN TRAINING CENTRE

MAHAJAN SAMANT

PRODUCT LIFE CYCLE STRATEGIES

The Pioneering Advantage Brand Preference The Competition Cycle Sole Supplier Competitive Penetration Share stability Commodity Competition Withdrawal Begins

INDO GERMAN TRAINING CENTRE

MAHAJAN SAMANT

PRODUCT LIFE CYCLE STRATEGIES

II. Growth Stage

1. 2. Improved in product quality, add new product features, improved styling etc. New models & flanker products (diff. Size, flavor). Enters new market segment Increases distribution coverage & enters new distribution channels. Advertising shift from product awareness to product preference. Lower prices to attract next layer of price sensitive customers.

3. 4.
5. 6.

INDO GERMAN TRAINING CENTRE

MAHAJAN SAMANT

PRODUCT LIFE CYCLE STRATEGIES

III. Maturity Stage

I. II. III. 1.
A.

Growth Stable Decaying Maturity Market Modification

To increase number of brand users.
i. ii. iii. Convert non users. Enter new market segment. With competitors customers. To use the product more frequently. To use the product more on each occasion. Discover new product uses & more varied ways.

B.

To increase present usage of the brand

i. ii. iii.

INDO GERMAN TRAINING CENTRE

MAHAJAN SAMANT

PRODUCT LIFE CYCLE STRATEGIES

III. Maturity Stage

2. Product Modification
A. B. C. Quality improvement durable, speed, size etc. Feature improvement Style improvement Prices Distribution Advertising Sales Promotion Personal Selling Services

3.

Marketing Mix Modification

A. B. C. D. E. F.

INDO GERMAN TRAINING CENTRE

MAHAJAN SAMANT

PRODUCT LIFE CYCLE STRATEGIES

IV. Decline Stage

i. Increase the firms investment. ii. Maintain the firms investment iii. Decrease the firms investment. iv. Harvesting (milking) to recover cash. v. Divesting business quickly. Also a) Withdrawal from market. b) Reduce number of products offered. c) Withdrawal from smaller market segment. d) Withdrawal from weaker trade channels. e) Cut promotion budget. f) Reduce price further. g) Increase price and sure end.
INDO GERMAN TRAINING CENTRE

MAHAJAN SAMANT

PRODUCT LIFE CYCLE STRATEGIES

CRITIQUE
1. 2. 3. 4. PLC patterns are too variable in shape and duration. Lacks fixed sequence and stages. Marketers can seldom tell the stage of PLC. PLC pattern is result of marketing strategies.

INDO GERMAN TRAINING CENTRE