Oct 26 - Product Strategy, Part II

Oct 26 - Product Strategy, Part II - Heavy promotional...

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Product Strategy, Part 2 October 26, 2009 Instructor: Tamar Milne
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Agenda Marketing throughout the product life cycle Product development strategies For next class. .. Midterm exams 2
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Introduction Stage Stimulate demand for new market entry Promotional campaigns stress features (benefits) Promotions to intermediaries to get them to carry the product Prices are typically high yet financial losses are common Working out the “bugs” 3
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Growth Stage Sales volume and profits rise rapidly Success attracts competitors Prices may drop slightly for competitive reasons Product improvements Additional spending on promotion, distribution 4
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Maturity Stage Industry sales eventually plateau Supply exceeds demand for first time Intense competition Diminishing differences between products Share gained at competitors’ expense
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Unformatted text preview: Heavy promotional spending Often price cuts Declining profits 5 Decline Stage Innovations or shifts in consumer preferences cause absolute decline in industry sales – Often coincides with growth stage of new product Industry profits fall (may become losses) Price cuts Eventually dropped from product mix 6 Extending the Product Life Cycle Increase frequency of use Increase number of users Find new uses Change the product: quality/performance, packaging ... or say goodbye, if necessary 7 Product Development Strategies 8 Current Product New Product Current Market/ Segment Market Penetration Product Development New Market/ Segment Market Development Diversification For Next Class. .. Reading: – Chapter 9: Product, Branding, and Packaging Decisions 9...
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Oct 26 - Product Strategy, Part II - Heavy promotional...

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