Lecture 02 Product Life Cycle PDF
Lecture 02 Product Life Cycle PDF
1
Product Life-Cycle (PLC)
Product Life-Cycle (PLC)
Product life cycle (PLC) is the course that a product sales and
profits take over its lifetime
Product
Development Introduction Growth Maturity Decline
Sales and Profits
Sales
Profits
Time
Phase I: Product development
• New ideas
• Market survey-is it required? Can it be produced at a profit?
• Product development and refinement
• Test Marketing
• Analysis of test marketing results
• Preparation for launch, publicity, marketing campaign
Phase II: Introduction/Launch
• Introduction of the product into the market
• It may be new product or old product to the new market
• Demand is low
• High cost/low sales
• Advertisement and promotion
• Monitor initial sales
Introduction phase
Characteristics and Objectives
Sales Low
Costs High cost per customer
Profits Negative
Marketing Objectives Create product awareness and trial
Phase III: Growth
• This period is the time to improve efficiency and product availability
as well as service
Profits Rising
Profits High
Maximize profits while defending
Marketing Objectives
market share
Phase V: Decline
• Competitors enter the market with
-Better product features
-Advanced technology
-Reduced prices
Profits Declining
Reduce expenditures and milk
Marketing Objectives
the brand
Strategies based on Product Life-Cycle
• Product
-Introduction: Offer basic product
-Growth: Offer product extension, service, warranty
-Maturity: Diversify brands/models
-Decline: Phase out weak products
• Price
• Distribution
• Advertising
• Sales promotion
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