A company has to be good at both developing new products and managing them in the face of changing tastes, technologies, and competition. Products generally go through a life cycle with predictable sales and profits. Marketers use the product life cycle to follow this progression and identify strategies to influence it. The product life cycle (PLC) starts with the product’s development and introduction, then moves toward withdrawal or eventual demise. This progression is shown in the graph, below. Show
The five stages of the PLC are:
The table below shows common characteristics of each stage.
Using the Product Life CycleThe product life cycle can be a useful tool in planning for the life of the product, but it has a number of limitations. Not all products follow a smooth and predictable growth path. Some products are tied to specific business cycles or have seasonal factors that impact growth. For example, enrollment in higher education tracks closely with economic trends. When there is an economic downturn, more people lose jobs and enroll in college to improve their job prospects. When the economy improves and more people are fully employed, college enrollments drop. This does not necessarily mean that education is in decline, only that it is in a down cycle. Furthermore, evidence suggests that the PLC framework holds true for industry segments but not necessarily for individual brands or projects, which are likely to experience greater variability.[1] Of course, changes in other elements of the marketing mix can also affect the performance of the product during its life cycle. Change in the competitive situation during each of these stages may have a much greater impact on the marketing approach than the PLC itself. An effective promotional program or a dramatic lowering of price may improve the sales picture in the decline period, at least temporarily. Usually the improvements brought about by non-product tactics are relatively short-lived, and basic alterations to product offerings provide longer benefits. Whether one accepts the S-shaped curve as a valid sales pattern or as a pattern that holds only for some products (but not for others), the PLC concept can still be very useful. It offers a framework for dealing systematically with product marketing issues and activities. The marketer needs to be aware of the generalizations that apply to a given product as it moves through the various stages. In which stage of the PLC will promotional expenditures be high?The introduction stage in the product life cycle is when a new product is introduced, and the company sales are small. The organizations undergo several marketing and promotional activities to attract customers who are unaware of the products.
In which stage of the PLC will promotional expenditures be high in an attempt to react to increasing?Maturity Stage:
Heavy expenditure is incurred on promotion to create brand loyalty. Firms try to modify and improve the product, to develop new uses of the product and to attract new customers in order to increase sales.
Which stage of the product life cycle will advertising expenditures be especially high in an attempt to create consumer awareness?Definition: Introduction stage is the first stage in the product life cycle. The highlighting factor of this stage is that the product is new in the market, sales are slow and to push it higher the company has to incur heavy expenditure on advertisement to make it appealing to customers.
In which stage of the product life cycle will promotional?The Introduction Stage of the Product Life Cycle
The introduction stage is when the company invests a good amount of money and effort in product marketing and promotion with no guarantees of any return. That's especially true if they're introducing a new product into the market.
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