Product Life Cycle and Innovation Strategies

Product Life Cycle and Strategies

• The product life cycle (PLC) describes the stages a product goes through from its introduction to its decline in the market. This includes stages like introduction, growth, maturity, and decline.
• Understanding the PLC is crucial for businesses to develop effective marketing strategies tailored to each stage. These strategies can encompass pricing, promotion, and distribution.
• Each stage of the PLC presents unique challenges and opportunities. For example, the introduction stage may require substantial investment in marketing to create awareness and build demand, while the maturity stage may demand differentiation strategies to maintain market share.

New Products and Degree of Innovation

• New product development involves introducing entirely new products or enhancing existing ones.
• Products can be classified according to their degree of innovation.
• Continuous innovation involves modifying existing products or improving their features without fundamentally changing them - think of new flavours or incremental changes in design.
• Dynamically continuous innovation represents a significant improvement in existing products, requiring a noticeably different set of behaviours from prior product use.
• Discontinuous innovation introduces entirely new products or processes that create new markets and require completely new behaviours.

What is the Adoption Curve?

• The adoption curve depicts the rate at which consumers adopt a new product or technology.
• It illustrates that not all customers adopt new products at the same rate.
• The curve typically shows a gradual adoption through different adopter categories:
  • Innovators: First to adopt new products.
  • Early adopters: Next to embrace new products, often opinion leaders.
  • Early majority: Important segment that weighs factors like price and value before adopting.
  • Late majority: More cautious, adopting later due to societal pressure to conform, or the lack of obvious advantages.
  • Laggards: Adopt products only when they've become established and less cost-prohibitive.

New Product Development and Process

• Developing new products is a complex process involving several key steps:
  • Idea generation: Brainstorming, researching competitors and customer needs are important methods.
  • Idea screening: Identifying ideas with potential for success based on factors like market size, profitability, and competitive analysis.
  • Concept development and testing: Generating detailed product descriptions, creating prototypes, test marketing to gauge consumer interest and feedback.
  • Marketing strategy development: Defining the target market, the marketing mix (product, price, place, promotion), and positioning strategy.
  • Business analysis: Assessing the product's feasibility, profitability, and risk.
  • Product development: Planning, designing, and procuring the product.
  • Test marketing: Testing the product in a real-world setting with consumers to evaluate its performance in the marketplace.
  • Commercialization: Full-scale launch of the product, encompassing manufacturing, distribution, and marketing efforts. This includes managing the entire process of making a product available to the target market.
• Failure rates in new product development are common and can stem from several causes such as poor market analysis, inadequate product features, or poor timing.
• Effective product development requires careful planning, thorough market research, and ongoing evaluation throughout the process.

This quiz explores the Product Life Cycle (PLC) and the strategies businesses use at each stage, including introduction, growth, maturity, and decline. It also covers new product development and the various degrees of innovation involved in the process. Understanding these concepts is essential for effective marketing practices.