The marketing mix begins with the product offering. It is
difficult to device a distribution system or set a price without
knowing the product to be marketed.
Product is defined as everything that one receives in an
exchange including all tangible and intangible attributes, and
expected benefits, it may be good, service or idea. It is anything
that is capable of satisfying a want. Another definition of
product holds that it is a set of tangible attributes, including
packaging, color, price, quality and brand plus the services and
reputation of the seller.
The product Life Cycle (PLC)
Products like consumers go through life cycles. They are born,
they live and they die. The product life cycle describes the
stages a new product idea goes through from beginning to end,
these are the:
1. Market Introduction
2. Market growth
3. Market maturity
, 4. Sales decline
The Four Stages of Product Life Cycle
1. Market Introduction Stage- sales are low as a new idea is
first introduced to a market. Customers are not aware of the
existence of the product. Informative promotion is needed to
tell potential customers about the advantages and uses of the
new product concept. They invest the money in the hope of
future profits.
2. Market growth stage- industry sales grow fast, but
industry profits rise and then start falling, the firm begins to
make big profits as more and more customers buy. But, in this
stage competitors see the opportunity and enter the market.
This is the time of biggest profits for the industry. But it is also
when the industry profits begin to decline as competition
increases.
3. Market maturity stage- occurs when industry sales level
off and competition gets tougher. Many aggressive competitors
have entered the race for profits. Industry profits go down
throughout the market maturity stage because promotion costs
rise and some competitors cut prices to attract business. Less
efficient firms that cannot compete with this pressure drop out
of the market. New firms may still enter the market at this
stage, increasing competition even more.
,4. Sales decline stage- a new products replace the old price
competition from dying products becomes more vigorous, but
firms that successfully differentiated their products may make
profits until the end. They may keep some sales by appealing to
loyal customers or those who are slow to try new ideas. The
sales end profits of a product or brand many not and often do
not follow the life-cycle pattern. They may vary up and down
throughout the life cycle, sometimes moving in the opposite
direction of industry sales and profits.
Extending Product Life Cycle
Marketing managers use several strategies to extend product
life cycles:
Promoting more frequent use of the product by current
customer: Example- orange juice is advertised as healthy,
refreshing beverage suitable for anytime of the day.
Finding new target markets for the product:
Baking soda is promoted as a refrigerator freshener,
jewelry cleaner and toothpaste for white teeth. Sales
would increase when each new suggested use appeared in
the print and television ad.
Pricing the product below the market: This is done by
introducing products of acceptable quality at low prices.
Developing new distribution channels
, A product that is sold only in department stores, and then
it was introduced in supermarkets and grocery stores
without any changes in the product itself, the price or the
promotional appeal.
Adding new ingredients or deleting old ingredients
The laundry detergent industry has relied on this strategy
to extend the life cycles of brands, adding whiteners,
bleachers, scents and various other ingredients and
attributes.
Making a dramatic new guarantee
A laundry soap approaching decline stage may give new
guarantee that it can remove stain from shirt, or an
astringent whitens the skin in just three (3) weeks of
application.
Branding
A brand is a name, term, symbol, design or combination
thereof that identifies a seller’s product and differentiates them
from competitor’s product.
A brand name is the part of the brand that can be spoken
including letters, words and number. The elements of a brand
that cannot be spoken are called the brand marks.
difficult to device a distribution system or set a price without
knowing the product to be marketed.
Product is defined as everything that one receives in an
exchange including all tangible and intangible attributes, and
expected benefits, it may be good, service or idea. It is anything
that is capable of satisfying a want. Another definition of
product holds that it is a set of tangible attributes, including
packaging, color, price, quality and brand plus the services and
reputation of the seller.
The product Life Cycle (PLC)
Products like consumers go through life cycles. They are born,
they live and they die. The product life cycle describes the
stages a new product idea goes through from beginning to end,
these are the:
1. Market Introduction
2. Market growth
3. Market maturity
, 4. Sales decline
The Four Stages of Product Life Cycle
1. Market Introduction Stage- sales are low as a new idea is
first introduced to a market. Customers are not aware of the
existence of the product. Informative promotion is needed to
tell potential customers about the advantages and uses of the
new product concept. They invest the money in the hope of
future profits.
2. Market growth stage- industry sales grow fast, but
industry profits rise and then start falling, the firm begins to
make big profits as more and more customers buy. But, in this
stage competitors see the opportunity and enter the market.
This is the time of biggest profits for the industry. But it is also
when the industry profits begin to decline as competition
increases.
3. Market maturity stage- occurs when industry sales level
off and competition gets tougher. Many aggressive competitors
have entered the race for profits. Industry profits go down
throughout the market maturity stage because promotion costs
rise and some competitors cut prices to attract business. Less
efficient firms that cannot compete with this pressure drop out
of the market. New firms may still enter the market at this
stage, increasing competition even more.
,4. Sales decline stage- a new products replace the old price
competition from dying products becomes more vigorous, but
firms that successfully differentiated their products may make
profits until the end. They may keep some sales by appealing to
loyal customers or those who are slow to try new ideas. The
sales end profits of a product or brand many not and often do
not follow the life-cycle pattern. They may vary up and down
throughout the life cycle, sometimes moving in the opposite
direction of industry sales and profits.
Extending Product Life Cycle
Marketing managers use several strategies to extend product
life cycles:
Promoting more frequent use of the product by current
customer: Example- orange juice is advertised as healthy,
refreshing beverage suitable for anytime of the day.
Finding new target markets for the product:
Baking soda is promoted as a refrigerator freshener,
jewelry cleaner and toothpaste for white teeth. Sales
would increase when each new suggested use appeared in
the print and television ad.
Pricing the product below the market: This is done by
introducing products of acceptable quality at low prices.
Developing new distribution channels
, A product that is sold only in department stores, and then
it was introduced in supermarkets and grocery stores
without any changes in the product itself, the price or the
promotional appeal.
Adding new ingredients or deleting old ingredients
The laundry detergent industry has relied on this strategy
to extend the life cycles of brands, adding whiteners,
bleachers, scents and various other ingredients and
attributes.
Making a dramatic new guarantee
A laundry soap approaching decline stage may give new
guarantee that it can remove stain from shirt, or an
astringent whitens the skin in just three (3) weeks of
application.
Branding
A brand is a name, term, symbol, design or combination
thereof that identifies a seller’s product and differentiates them
from competitor’s product.
A brand name is the part of the brand that can be spoken
including letters, words and number. The elements of a brand
that cannot be spoken are called the brand marks.
