Home | ARTS | Marketing Management | Pattern of Growth – A Life Cycle Analysis for New Products - Product Life Cycle

MARKETING MANAGEMENT - Product Life Cycle

Pattern of Growth – A Life Cycle Analysis for New Products - Product Life Cycle

   Posted On :  18.06.2018 10:01 pm

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 Products
 
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 also discussed.
 

Different Strategies

 
 
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 challenge.
 

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 strategies.
 
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 product.
 
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 saturation stages.
 
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 of obsolescence.

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 srage.
 

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 eliminates profits.
 

d.Distribution 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 used.
 

e.Advertising 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
Last 30 days 329 views

OTHER SUGEST TOPIC