Question

Select a current product on the market today that you are familiar with. Based on your knowledge of the product life cycle, what stage of the PLC is this product in and what types of changes will occur to your selected product as it continues through the product life cycle? How will this affect the marketing of your selected product?

Answer 1

Product life cycle has got 4 stages as below

1. Introduction
2. Growth
3. Maturity
4. Decline

For this we will take the example of Electric Cars being made by Tesla.

This product has crossed the Introduction phase, where is cash flow is negative and cost of development and production were highest. Now as this product has entered into the growth phase the cost of production is tending to go down, Sales revenue has started to rise and very soon it will meet the breakeven point.

Now we will list down the marketing strategy of its present stage and what would be the marketing strategy as the product moves further into its life cycle, here we are not estimating the time that this product would spend in each of the growth phases, hence we will only describe the marketing strategy which would be implemented along the growth stages.

Phase: Growth

Marketing Strategy: Increase the scale of production, Expand the reach of the product and become more and more competitive. Optimization of the production and sales process which marketing should support to attract more customers towards the product with its strong value proposition, as we can pass the benefit of lowered production cost to the prospective buyers.

Phase: Maturity

Marketing Strategy: The objective of the implemented marketing strategy should be retention of customers and maintaining the market share, as the future of mobility may move to some cars which are running autonomously or on hydrogen fuel or any other alternative fuel which may be cheaper than electricity. Under such scenario battling the churn while delighting more number of customer with evolving value proposition will be the marketing strategy.

Phase: Decline

Marketing Strategy: At this point of time we need to select or determine the best outcome. The options could be either phasing out or re-engineering the product itself. If we are re-engineering the product to enhance its life cycle which should be the objective of the marketing strategy so that the product life cycle gets expanded to the extent it is possible to do so. Some investment in marketing and tactics to retain the market share and communicating the improved value proposition of the product should be the marketing strategy in this phase.