MBA 1303 - Principles of Marketing

Product Life Cycle

Marketing Strategies
Presented by:
Ms. Adiba Anis, Lecturer (Marketing), School of Business, Bangladesh
Open University

Ms. Adiba Anis

1

Defining Product Life Cycle (PLC)

The course of a products sales and profits over its lifetime.

It involves 4 distinct stages:

Introduction,
Growth,
Maturity, and
Decline

Companies normally reformulate their marketing strategies

several times during a products life.
Factors pushing a company to launch a new product can be:
Changing economic conditions,
Competitors launching a new product,
Shift in buyers interest, etc.

Ms. Adiba Anis, Lecturer (Marketing), School of Business, Bangladesh

Open University

Stages of the PLC

Introduction: A period of slow sales growth as the
product is introduced in the market. Profit are
nonexistent in this stage because of the heavy
expenses incurred with product introduction.
2. Growth: A period of rapid market acceptance and
substantial profit improvement.
3. Maturity: A period of slowdown in sales growth
because the product has achieved acceptance by most
potential buyers. Profits stabilize or decline because of
increased competition.
4. Decline: The period when sales show a downward drift
and profits erode.
1.

Ms. Adiba Anis, Lecturer (Marketing), School of Business, Bangladesh

Open University

Marketing Strategies
For the stages of Product Life Cycle

Ms. Adiba Anis, Lecturer (Marketing), School of Business, Bangladesh

Open University

A general PLC
Here, promotional expenditure Introduction
remains higher because the
company wants to
a) inform the potential
consumers,
b) initiate pilot projects and
c) secure distribution in retail
outlets.

Stage

Marketers can take one of the four

strategies considering price and
promotion.
Rapid Skimming Samsung
Galaxy Tab
2. Slow Skimming Blackberry
3. Rapid Penetration Micromax
Ms. Adiba
Anis, Lecturer (Marketing), School of Business, Bangladesh
4. Slow Penetration
Maximus,
Open University
XKSSTEEL
1.

A general PLC

Growth Stage

Sales climb up at a higher rate considering to promotional

expenses.
New competitors emerge, so, a company should strategize
carefully.
Theme Parks, DVD Players.
1. Improve the quality of the product, adding new product
features or style.
2. Add new models with different sizes, flavors, colors, etc.
3. Enter into a new market segment.
4. Enter a new distribution channel or increase the
coverage of its distribution.
5. Advertising message should focus on Product
Preference Advertising rather than Product Awareness
Advertising.
6. Lower the price of the product in order to attract the
next layer of the consumer group.
Ms. Adiba Anis, Lecturer (Marketing), School of Business, Bangladesh
Open University

A general PLC

Maturity Stage

The maturity stage can be divided into three parts:

growth, stable and decaying maturity.
Wooden Furniture, Pepsi, Coca Cola, CRT Monitors.
The company can adopt 3 strategies in this stage.
1.
2.

Market Modification
Product Modification
Quality improvement,
2. Feature improvement
3. Style improvement.
1.

3.

Marketing Mix Modification

Ms. Adiba Anis, Lecturer (Marketing), School of Business, Bangladesh

Open University

A general PLC

Declining Stage

Typewriters, Black & White TV

Increase the firms investment.
Maintaining the firms investment.
Decreasing the firms investment
level selectively.
Harvesting Picking-up the firms
investment to recover cash quickly.
Divesting Disposing of its assets.

Ms. Adiba Anis, Lecturer (Marketing), School of Business, Bangladesh

Open University

Characteristics, Marketing
Objectives and Strategies
of the Product Life Cycle

Ms. Adiba Anis, Lecturer (Marketing), School of Business, Bangladesh

Open University

PLC: Characteristics
Characteris
tics

Introductio
n

Growth

Maturity

Decline

Sales

Low Sales

Rapidly Rising
Sales

Peak Sales

Declining Sales

Costs

High Cost Per

Customer

Avg. Cost Per

Customer

Low Cost Per

Customer

Low Cost Per

Customer

Profits

Negative

Rising Profits

High Profits

Declining
Profits

Customers

Innovators

Early Adopters

Middle
Majority

Laggards

Competitors

Few

Growing
Numbers

Stable
Numbers

Decline
Numbers

Ms. Adiba Anis, Lecturer (Marketing), School of Business, Bangladesh

Open University

10

PLC: Marketing
Objectives

Introduction

Marketin
g
Objective
s

Create
Product
Awareness
and Trial

Growth

Maturity

Decline

Maximize
Market
Share

Maximize
Profit While
Defending
Market
Share

Reduce
Expenditure

Ms. Adiba Anis, Lecturer (Marketing), School of Business, Bangladesh

Open University

11

PLC: Marketing
Strategies

Strategi
es

Introductio
n

Growth

Maturity

Decline

Product

Offer A Basic
Product

Offer Product
Extensions, Service
And Warranty

Diversify Brands
And Items

Phase Out Weak

Models

Price

Charge cost-plus
Pricing Strategy

Penetration Pricing
Strategy

Competition
Based Strategy

Discount/Sales
Promotion/Price
Cut Strategy

Distribution

Build Selective
Distribution

Build Intensive
Distribution

Build More
Intensive
Distribution

Selective And
Phase Out
Unprofitable
Outlets

Advertising

Build Product
Awareness
Among Early
Adopters And
Dealers

Build Awareness
And Interest In The
Mass-Market

Stress Brand
Differences And
Benefits

Maintain
Relationship With
The Loyal Groups

Sales
Promotion

Heavy Sales
Promotion

Reduce Promotional
Expenditure

Increase To
Encourage Brand
Switching

Reduce To Minimal
Level

Ms. Adiba Anis, Lecturer (Marketing), School of Business, Bangladesh

Open University

12

Thank you

The End

Ms. Adiba Anis, Lecturer (Marketing), School of Business, Bangladesh

Open University

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