In: Economics
Marketing Lemonade Worksheet
Scenario
Your team is looking for a way to make some revenue as either a for-profit or not-for-profit organization. This organization can market locally, nationally, or internationally, and can be a privately-owned company or a franchised organization. The product that you have decided to sell is lemonade. To make the endeavor work, you will have to define a marketable form of the drink and decide on a target market.
Your marketing team's mission is to prove through research, strategy development, and reasoning why this form of this product is viable and will meet the company's goals. In the first half of this project, your team will complete this worksheet to report on the following:
I need help with the life cycle of lemonade
The product life cycle describes the life of a product in the market with respect to business . The stages of the life cycle of a product ie lemonade involves 4 stages-introduction ,growth , maturity, decline.
Introduction --In this stage the product has low growth rate of sales as the product has been just launched in the market and the consumers do not know about it. So at this stage the produt incurs loss .But the good thing is that there is less competition at this stage.In order to get the market share , pricing the product at this stage is very important.The characteristics of this stage are high cost entailed due to advertising,marketing, distribution etc.Sales is low but increases gradually.There is little or no competition at all.It is necessary to increase demand through awareness campaign and promotion.Customers should be guided properly to use the product and there is less profit as sales are low.
Growth-During this stage customers become aware of the product and sales increase. The company earns profit.But the company remains in the break even point for a long time , until the product enters stage 3. But this depends on the cost and revenue structures of the company.The important features of this stage are that cost gets reduced due to large economies of production.Sales increases as people become aware of the product.Profits increase as revenue continues to rise.Public awareness is increased through promotion, word of mouth,Competition increases as few more competitors who produce lemonade ,enter the market.Increased competition leads to lowering of the prices as technology and factors of production become cheaper.
Maturity-At this stages sales reach a new height . It reaches the peak and competition grows.But ultimately the market saturates and demand for the product falls as tastes of consumers changes and there is technological change as well.The company takes certain actions like improving certain features of the product to resell them in the market, lower the prices due to increased competition,increase in promotional and advertising efforts, Differentiating products in order to revive sales,and looking for a new target market.Thus costs get lowered as a result of the increase in volume of production and sales volume increases unless saturation is reached.Profit in this stage go down.
Decline-During this stage , sales become negative,profits fall, competition remains high,and the product ultimately reaches its death.The features are fall in sales and competition becomes severe as well as decline in the popularity of the product.Prices fall and profits fall too.The cost structure is counter optimal.Consumers taste changes and new technologies in the market makes the product obsolete.Profits fall to the level where it is necessary to shut down production.Profits become a challenge of increasing production and distribution and of increasing the volume of sale.However,product death is not the end of abusiness cycle , it the end of asingle product only which has failed to compete in the market.