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Introduction to Product Management
Marketing Mix During Product Life Cycle
- The PLC explains how features change over the life of a product
- Marketing strategies must change and evolve as a product moves through the PLC
Growth
- Sales grow at an increasing rate
- Many competitors enter market
- Large companies may acquire small pioneering firms
- Promotion emphasizes brand advertising and comparative ads – “pull strategy”
- Wider distribution – “push strategy”
- Toward end of growth stage, prices fall
- Sales volume creates economies of scale
Maturity
- Sales continue to increase but at a decreasing rate
- Marketplace is approaching saturation
- Typified by annual models of products with an emphasis on style rather than function
- Product lines are widened or extended
- Marginal competitors drop out
- Heavy promotions - sales promotions “push”
- Prices and profits fall
- Production moves to lower cost locations
Decline
- Signaled by a long-run drop in sales
- Rate of decline is governed by how rapidly consumer tastes change or how rapidly substitute products are adopted.
- Falling demand forces many out of market
- Few specialty firms left