Even then the existence of initiative products/services and the emphasis of management on such products cannot be ignored.
Pattern of Growth – A Life Cycle Analysis for New
Even then the existence of
initiative products/services and the emphasis of management on such products
cannot be ignored. This may be due to the recognized marketing gap hitherto
unfilled by the existing producers, product deficiencies and identified
consumer dissatisfaction with available products in the market.
The super cautious attitude of
management towards innovation, which may be due to fear and high cost of
product failures, may also be a reason for increased emphasis on imitative new
products. Just like a human being pass through different stages of the life
cycle, a product in the market should also different stages of the life cycle a
product in the market should also pass through different stages from
introduction to decline and possible abandonment.
The concept of the product
lifecycle indiscriminately applies both to innovative and imitative products.
The noted stages of a product’s life cycle include introduction, growth,
maturity and saturation, decline and possible abandonment. He challenges and
characteristics for innovative product imitative new product in their
respective product life cycle stages are analyzed here.
The strategies for meeting these
challenges, at each stage of the life cycle for the respective products are
Innovative and imitative products
require different kinds of marketing strategies. Right from the embryonic stage
of product development, these differences in dealing with innovative and
imitative new products are noticeable. For instance, a new brand of soap,
toothpaste, scooter or car is an imitative new product; on the other hand, a
flying car or scooter is an innovative product. Imitative new products have to
overcome the existing competition to establish them in the market. But in the
case of innovative products prospective and not the present competition is a
a. Introduction and Growth Stage
The introduction stage of the
product life cycle is the entry of the product in the market. Generally, in the
earlier days of introduction, because of the product is known and its positive
characteristics are less known to the consumer, sales or less. Even though
there is increase in sales, it is at a slow place. The ease of introducing a
product depends on the degree of its novelty, improvements over the existing
products, distinctiveness and a host of other factors.
Innovative products can be
introduced in the market with relative competitive ease because there is no
competition to be broken. This is much easier if the product has with a highly
technical or utilitarian aspect. But for imitative products it is difficult
even to enter the market under competitive conditions.
No doubt, the degree of this difficulty is much
influenced by the extent of market satisfaction number of existing rival
products and the marketing and product advantage they offer to the customer.
Generally, the prospective
consumers for a newly introduced product is already selective in his nature.
Therefore new imitative products should have some step-up features and marginal
improvements so as to divert the attention, affiliation and loyalty of the
consumer from the already existing alternative brands in the market.
But in the case of innovative or
really new products, convincing the consumer about the product’s marketing
advantage or utility is enough to find a place in market. However, the initial
positioning of the products should be on sound lines with a long run
competitive perspective, so as to be less vulnerable to the competitor’s
The introduction stage of any
product is generally charactersied by low sales volume, limited distribution
and high costs of promotion. These may be common to a great extent for
innovative and imitative products. But with respect to promotion strategy, for
truly innovative products the main objective is primary demand creations,
whereas it is secondary demand for imitative products.
In other words, due to the real
newness of the product appeal to the consumer rather than bran appeal as in the
case of imitative products
.on the other hand, where the existing products
dominate the market, imitative products as new entrants should try to snatch
away the market of other products and thus establish their share of the market.
The success of innovative
products in the introducing phase depends largely on the promotional efforts
and their positioning. But the success of imitative products is conditioned by
the extend of competition, the existing competitors, strength and quality of
their products, offered to the consumers through promotion and the life stage
of the exiting products.
The duration of the introduction
stage for innovation is generally less, provided the products are effectively
and extensively promoted.
Moreover, the number of possible
product failures is also less with respect to an innovative product. Because
the direct competitive forces are absent the internal marketing effort and
efficiency is the major deciding factor for the product’s success. On the other
hand, the imitative products often fail because of the competition and counter
market strategies by the existing competitors.
Therefore, imitative products,
which enter the growth stage should try to counter the marketing efforts of the
marketers and at the same time develop a good image and a competitive edge by
capitalizing the weakness of the existing products. The intensity of
competition will also differ in this stage for innovative and imitative
products should plan for product improvement or finding new uses for the
Thus the marketer can maintain
his competitive edge and retain his distinction and market share. The duration
of this stage of product life cycle may also vary in both cases. Imitative
products, unless they are highly distinctive, of better quality and
exceptionally appealing to the consumers, have a short span of growth stage. On
the other hand, ceteris paribus, innovative products are likely to stay in the
growth stage for a longer period because they take considerable time for the
imitators to come up with their own versions of innovative products.
b. Maturity and Saturation Stages
Once the product passes through
the growth or market acceptance sage in due course, it enters the maturity
stage followed by saturation. The former is characterized by increase in sales
but at a low rate and the alter by stagnation in sales. The maturity stage in a
product’s life cycle is characterized by increasing sales and profit, but the
rate of increase is less than that in the growth stage.
This reduced growth rate is
certainly due to imminent competition in the market. Here one should not forget
that innovative products face competition from new and improved imitative
market entrants from time to time, whereas imitative products have to content
with existing products.
When the question of guarding
against the phenomena of maturity and saturation stages arises a clear forecast
of the setting in of these phases is essentially required. Otherwise, designing of
effective marketing strategies to prevent the early setting in of maturity and
saturation is not possible. Sometimes, if the products sales are close to the
break-even levels, losses become inevitable especially in the saturation stage.
Moreover, there may be a drop-out
of the products at this stage if actual sales fall below the break-even levels.
In order to prevent such as eventuality, strategies such as product
improvements, price reductions, effective advertising and sales promotion
activities should be intensified. When compared to imitative products,
innovative products, generally experience a longer span of maturity and
This may be due to the early life
cycle or the introduction stage of competing products and consequent less
competition; or the competing and newly emerging imitations of the innovative
products may have a low level of consumer acceptance. Moreover, innovative
products may have a scope to adopt improvements through planned obsolescence
when their imitations try to emerge a strong product in the market.
The strategy of systematic and
timely planned untouched, potential segments of the markets and a number of
other such strategies are quite significant to prevent the early entry of the
product in to the decline stage. Especially, innovative products should not go
for planned obsolescence before the entry of vital competitors with their own
imitative versions. And growth so as to reserve it for maturity and saturation
to revitalize the life cycle curve.
Just like any human being enters
into the life cycle phase of inevitable physical deterioration and death,
products also do enter into the stage of decline and possible abandonment. How
fast a product approaches this stage is dependent on the marketing environment,
market forces, product characteristics, and competitive strengths of the
product and extent of product differentiation.
As the new products enter the
market, from time to time, virtually all the products enter the market, from
time to time, virtually all the products are certainly caught in the clutches
When the competing products
establish their firm footing and consolidate their position in the market, the
earlier entrants to the market fall prey to the clutches of decline. If a
product, either innovative or imitative, stays in the saturation stage
competitors try to aggravate their promotional effort to establish their
superiority and push the innovative product to decline and consequently to the
wall. How far a product can withstand the threat of the decline and curse of
obsolescence depends on the managerial efficiency, efficiency of the marketing
management and product strategies.
This stage of any product’s life
poses challenges to the management. In this stage, the competitive strategies
of promotion, re-pricing and repositioning are warranted to inject a new lease
of life to the product. No one should be left unturned to revitalize the
product lifecycle. For a successful revitalization, every effort to maintain
the morale and loyalty of middlemen to carry out the product on their shelves
as against those competitors is highly significant.
Strategic Considerations in the PLC Concept
a.Competition At the introductory stage,
competition is given no important the growth stage, it is given a little
important while at the maturity stage, there are many in the market slowly,
however, the number of competitors or rivals gets reduced with the declining
b.Over all Strategic Focus At the first stage, emphasis is
laid on market establishment. At the growth stage, market penetration and
persuasion of mass market are emphasis. Creation of brand loyally and brand
preferences is focused at the maturity stage. At the decline stage, the
strategy aims at overall preparation for renewal.
c.Profit At the introductory stage, profit
is negligible but all the growth stage, they reach the peak levels as a result
of growing demand. At the maturity stage, they decline due to the increasing
competition. At the last stage, the declining volume pushes costs up and
Strategies At the introduction stage,
distribution is selective. However growth and maturity stages, it is intensive.
At the decline stage, it becomes selective and hence low-end strategies are
Strategies At the introduction stage,
advertising strategies aim at the needs of early adopters; at the growth stage.
An attempt is made to make the mass market aware of brand benefits. At maturity
stage, advertising is used as a vehicle for differentiating among otherwise
similar brands. At the last stage, however it emphasizes, on low price of the
product and minimum advertising expenditure.
Tags : MARKETING MANAGEMENT - Product Life Cycle
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