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BUSMKT 1040 Chapter 10 Managing Products Services Brands.pptx

BUSMKT 1040 Chapter 10 Managing Products Services Brands.pptx

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CHAPTER 10 Managing Successful Products, Services, and Brands
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Marketing Throughout the PLC The Product Life Cycle (PLC): The stages a product goes through in the marketplace concept that seeks to describe a product’s sales, competitors, customers, and marketing emphasis from its beginning until it is removed from the market. Marketing strategies must change and evolve as a product moves through the PLC
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The Product Life Cycle
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Introduction Full-scale launch of new product into marketplace Sales are low, high failure rate Little competition Frequent product modification Limited distribution High marketing and product costs Promotion focused on product awareness and to stimulate primary demand Intensive personal selling to retailers and wholesalers
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Growth Sales grow at an increasing rate Many competitors enter market Large companies may acquire small pioneering firms Profits are healthy Promotion emphasizes brand advertising and comparative ads Wider distribution Toward end of growth stage, prices fall Sales volume creates economies of scale
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Maturity Sales continue to increase but at a decreasing rate Marketplace is approaching saturation Typified by annual models of products with an emphasis on style rather than function Product lines are widened or extended Marginal competitors drop out Heavy promotions - sales promotions Prices and profits fall
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Decline Signaled by a long-run drop in sales Rate of decline is governed by how rapidly consumer tastes change or how rapidly substitute products are adopted Falling demand forces many out of market Few specialty firms left Possible strategies for decline stage: Deletion – drop product from product line Harvesting – retain product but reduce marketing costs
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Selected Product Life Cycles Traditional Boom or Classic Fad Extended Fad Seasonal or Fashion Revival Bust More likely for a product class than a particular product.
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