Question

• Examine the product life cycles for your chosen two products relative to how it affects the company’s marketing strategies
• How would your suggestion be different for the two companies' brand managers about making decisions on price, advertising, and distribution channels?

Answer 1

Usually from the development of a product to it’s decline in value and eventual retirement from the market, the product suffers four stages which is called as product life cycle.  The four stages are introduction, growth, maturity and decline. Various marketing strategies may be implemented in order to prolong the life cycle during each stage.

Growth phase

Example:  Tesla Model S car is in its growth phase. Electric cars still need to convince people that it will work and be practical. As there are more electric charging points and more people adopt, it becomes easier to sell to those who are more sceptical of new technology like electric cars.

Marketing strategies:

• Firm is  required to capitalise on growth to extend product sales.
• Firms can change marketing from niche areas to a more mass market.
• The firm can adapt to consumer feedback and  can offer new features or better consumer support and services.

Advice to the manager includes:

• Pricingshould be maintained as the firm enjoys increasing demand with little competition.
• Distribution channelsare added as demand increases and customers accept the product.
• Promotion should be aimed at a broader audience.

Maturity phase

Example: Ford Focus car. The well established car has a good brand reputation and has reached its peak level of market penetration. It would be difficult to gain a significantly greater market share. The product life cycle of the Ford Focus has been extended by constant upgrades and redesigns to keep the car on top of the market.

Marketing strategies:

• With peak market penetration, the firm may search to increase prices to increase profitability. However, if the market is very competitive the firm may feel the need to keep prices low to defend market share.
• The firm may concentrate on seeking to improve the product to gain market differentiation and prolong the maturity period.

Advice to the manager consists of:

• Productfeatures may be enhanced to differentiate the product from those of its competitors.
• Distributionbecomes should be intensive and incentives may be offered to improve preference over competing products.
• Promotion  should be emphasized at product differentiation.

(A like will be great if you are ok with the answer!)