Podcast
Questions and Answers
What are the four basic stages of the product life cycle?
What are the four basic stages of the product life cycle?
What characterizes the introduction stage of the product life cycle?
What characterizes the introduction stage of the product life cycle?
Sales grow slowly and minimal profits as a result of large investment costs in development.
What are the characteristics of the growth stage in the product life cycle?
What are the characteristics of the growth stage in the product life cycle?
Rapid increases in sales, competition appears, and profit peaks.
What happens during the maturity stage of the product life cycle?
What happens during the maturity stage of the product life cycle?
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What occurs in the decline stage of the product life cycle?
What occurs in the decline stage of the product life cycle?
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What are the marketing strategy implications of the product life cycle?
What are the marketing strategy implications of the product life cycle?
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Match the stages of new-product development with their descriptions:
Match the stages of new-product development with their descriptions:
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What is the purpose of business analysis in new-product development?
What is the purpose of business analysis in new-product development?
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What is commercialization in the context of product development?
What is commercialization in the context of product development?
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What strategies can marketers employ to extend the product life cycle?
What strategies can marketers employ to extend the product life cycle?
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Study Notes
Product Life Cycle
- Consists of four stages: introduction, growth, maturity, and decline.
- Each stage represents a distinct phase in a product's market journey.
Introduction Stage
- Product enters the target market with slow sales growth.
- Minimal profits due to high initial development costs.
Growth Stage
- Rapid increase in sales as product gains market acceptance.
- Profit peaks as competition emerges.
- Advertising focuses on selective demand; new features may be introduced, e.g., "New and Improved!"
Maturity Stage
- Sales growth slows down; marginal competitors may exit the market.
- Most consumers are repeat purchasers or have previously tried the product.
- Emphasis on maintaining market share through differentiation and attracting new buyers.
- Examples include established products like soft drinks and DVD players.
Decline Stage
- Noticeable drop in sales due to changing market conditions (e.g., technology shifts).
- Companies may choose between:
- Deletion: removing the product from the lineup, as seen when IBM stopped making laptops.
- Harvesting: maintaining minimal marketing efforts while continuing to offer the product, such as Coca-Cola’s Tab diet cola.
Marketing Strategy Implications
- Product life cycle informs flexible marketing strategies responding to marketplace changes.
- Strategies may involve product development, price adjustments, expanded distribution, and promotional shifts.
- Goal is to extend product life cycle as long as it remains profitable.
Stages in New-Product Development
- Idea generation: systematic search for new product possibilities.
- Idea screening: filtering new ideas to retain viable ones.
- Concept development: using consumer feedback to test product ideas.
- Marketing strategy development: planning how to introduce the product effectively.
- Business analysis: evaluating potential sales, profits, and strategic fit within company resources.
- Product development: transforming concepts into tangible products.
- Test marketing: trial launch in a selected market area.
- Commercialization: full market launch of the new product.
Key Questions and Answers
- Stages of the product life cycle: Introduction stimulates demand, growth sees rising sales and profits, maturity hits saturation, and decline faces reduced sales and profits.
- Marketing implications: Strategies to prolong the product life cycle include increasing usage frequency, identifying new customer segments, and redesigning product features or packaging.
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Description
Test your knowledge of the product life cycle with these flashcards. Explore the four stages: introduction, growth, maturity, and decline. Each card provides concise definitions to enhance your understanding of this crucial business concept.
