There are many reasons why companies bring products to market place. The one we would naturally think of is to make more money, but that is generally only one of the reasons. Changing Consumer Needs Companies need to stay in touch the changing needs of consumers. Companies cannot remain with Read full article…
Financial forecasting in marketing Preparing a financial forecast is usually a key requirement in order to have a major marketing campaign, new product, or other marketing project approved. As in most cases, is there is a significant investment up front or during the early part of the campaign/project. Therefore, it Read full article…
The product life cycle template for Excel – available for free download Often students want to graph multiple products onto the product life cycle using an Excel spreadsheet or some other charting approach. Perhaps surprisingly, this is sometimes awkward to produce easily, given the focus on the Excel spreadsheet to Read full article…
As it is possible to use the product life cycle as a portfolio analysis tool, which allows us to consider whether we have adequately provided for the future profitability for the firm/brand, it is an obvious that there is a strong connection between the product life cycle and the firm’s Read full article…
Marketing mix strategies during the introduction stage Offer a basic product with limited choices, as this also helps test the overall market demand/interest, while keeping costs and logistic challenges relatively low Use marketing communications (IMC/promotion) that are effective in generating initial awareness and reaching innovators. Often specialist websites/blogs and magazines Read full article…
While the product life cycle model is a very helpful tool for helping to understand current and potential market conditions, in order to develop appropriate marketing and competitive strategies, there are some limitations and concerns with the usage of the PLC. Firstly, not all new products will be successful. That Read full article…
One of the challenges of a mature market in the PLC is that, more than likely, eventually the firm will be faced with competition from new style of product. That is, the most significant competitors are going to introduce technology that is quite different in their design/features (while meeting the Read full article…
In order to assess where a product is on the PLC curve, a multiple of factors can be considered, including: Sales to date, graph accordingly, to visually demonstrate any turning points from introduction to growth, and so on, The number of competitors entering/leaving the marketplace (competitors enter in growth and Read full article…
This website has discussed consumer innovators numerous times, due to their importance in generating product adoption and kick-starting the introduction phase of the product life cycle. While innovators are the initial type of consumer, there are other consumer mindsets that are typically discussed in marketing textbooks. The standard consumer adoption Read full article…
There is a strong relationship between the product adoption process and the product life cycle. Both consider new to the world products – the product adoption process considers the “stage” that the consumer is in relative to the product – whereas the product life cycle model will track sales (and Read full article…
Underpinning the pattern of sales in the product life cycle is how consumers adopt new products. Not all new products are successful, indeed, most new products will fail. For example, even Apple has its fair share of failed products. As we know, the product life cycle moves through four distinct Read full article…
The PLC model can be utilized for portfolio analysis Do we have an appropriate balance of existing products in a mature market, and are we investing in future new product opportunities by entering products into introduction and growth stage markets? Again, this is conceptually similar to the underlying principle of Read full article…
A more limited competitor set It is likely, in the introduction phase of the product life cycle, that there are limited numbers of competitors. At this stage of the PLC, the level of sales and profits in the market are quite small – which is unlikely to attract a large Read full article…
Key marketing challenges in the introduction phase One of the key marketing challenges in the introduction phase of the product life cycle (PLC) is to clearly communicate the advantages and benefits of the new product offering, relative to existing products in the marketplace. This requires a significant and targeted communications Read full article…
Well-managed Product Portfolios Having survived the significant competitive battle of the growth stage, firms are looking for stability and ongoing profitability and to leverage their “cash cows”. It is also likely, in most well-managed firms, that they have now/since entered other markets and have new products in the introduction phase Read full article…
In the growth stage of the PLC there is a limited degree of customer loyalty. This is because most customers are “first-time consumers” and have no direct experience purchasing the product. This means that in a growth market, it is common to see the competitors try to obtain as much Read full article…
Growth phase follows the introduction phase The growth phase follows a successful introduction stage. There is no guarantee that a new product will be successful – therefore, not all new products will have a growth phase. However, provided that the firm has been successful in reaching innovators in the market, Read full article…
Product reinvention to trigger a new growth phase In a mature market, potentially entering the decline stage of the product life cycle, larger firms may be in a position to try and rethink the overall positioning of a product in order to try and broaden its market or to create Read full article…
Following the maturity stage of the PLC, many products at some point will enter the decline stage. The decline stage is a significant reduction in sales volumes. Typically this occurs for two main reasons: There is a new product category in the market that provides a better solution and has Read full article…
One of the key challenges for the firm during the introduction phase, given the important role of innovators, is the limited level of sales and likely negative profitability. This occurs because only a small proportion of consumers – the innovators – will trial/purchasing new product in its early stages. Because Read full article…