PRODUCT LIFECYCLE EXTENSION STRATEGIES
The aim of these strategies is to prevent a decline in the products
This shows the sales of a product over time.
sales.
DEVELOPMENT:
By targeting a new segment of the market: a new geographic
Sales will be zero. There will be high costs per unit and there will be market could be targeted e.g. China.
early discussions with retailers who will help in finalising the product By increasing the usage of the product: e.g. Actimel’s eat one
packaging. Prototypes. pot a day ‘challenge’ which encourages increased consumption.
By developing new uses for the product or widening the
INTRODUCTION: product range.
Special promotions or extra advertising.
Sales will be low. There will be high costs per unit because sales are
low but launch costs are high and overheads are being spread over BOSTON MATRIX
a few units. Pricing depends on different strategies e.g. skimming or
penetration. This examines the existing position of a firm’s product. This allows the
firm to consider its existing position and plan what to do next and
GROWTH: where to direct its marketing efforts.
Sales are increasing. There will be falling costs per unit as It considers the market share and the rate of growth of the
overheads are spread over more units. Distribution may be markets in which they operate.
increasing, and the product may have been modified given initial
customer feedback. CASH COW: a high share of a slow-growing market. This type of
product generates high profits and cash for the company because sales
MATURITY: are high, while the promotional cost per unit is quite low.
Growth is slowing. Promotion may focus on highlighting differences PROBLEM CHILD: a low share of a fast-growing market. These
with competitor’s products, and they may focus on key outlets and products usually need a high level of investment to promote and get
more profitable outlets. them distributed.
Then the product will either go into decline or an extension strategy DOGS: a low share of a declining market. The product or brand will
is used. be killed off once it’s sale drop below break even.
DECLINE: RISING STAR: a high share of a growing market. Very successful
but still need heavy promotion to ensure maintained sales.
Sales are falling. There will be lower budgets to keep costs down and
there is likely to be discounts to maintain sales.
The aim of these strategies is to prevent a decline in the products
This shows the sales of a product over time.
sales.
DEVELOPMENT:
By targeting a new segment of the market: a new geographic
Sales will be zero. There will be high costs per unit and there will be market could be targeted e.g. China.
early discussions with retailers who will help in finalising the product By increasing the usage of the product: e.g. Actimel’s eat one
packaging. Prototypes. pot a day ‘challenge’ which encourages increased consumption.
By developing new uses for the product or widening the
INTRODUCTION: product range.
Special promotions or extra advertising.
Sales will be low. There will be high costs per unit because sales are
low but launch costs are high and overheads are being spread over BOSTON MATRIX
a few units. Pricing depends on different strategies e.g. skimming or
penetration. This examines the existing position of a firm’s product. This allows the
firm to consider its existing position and plan what to do next and
GROWTH: where to direct its marketing efforts.
Sales are increasing. There will be falling costs per unit as It considers the market share and the rate of growth of the
overheads are spread over more units. Distribution may be markets in which they operate.
increasing, and the product may have been modified given initial
customer feedback. CASH COW: a high share of a slow-growing market. This type of
product generates high profits and cash for the company because sales
MATURITY: are high, while the promotional cost per unit is quite low.
Growth is slowing. Promotion may focus on highlighting differences PROBLEM CHILD: a low share of a fast-growing market. These
with competitor’s products, and they may focus on key outlets and products usually need a high level of investment to promote and get
more profitable outlets. them distributed.
Then the product will either go into decline or an extension strategy DOGS: a low share of a declining market. The product or brand will
is used. be killed off once it’s sale drop below break even.
DECLINE: RISING STAR: a high share of a growing market. Very successful
but still need heavy promotion to ensure maintained sales.
Sales are falling. There will be lower budgets to keep costs down and
there is likely to be discounts to maintain sales.
