A low profile strategy consists of launching the new

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A low-profile strategy consists of launching the new product with a low price and low level of promotion. The low price will encourage the market’s rapid acceptance of the product; at the same time, the company keeps its promotion costs down in order to realize more net profit. The company firmly believes that market demand is highly price-elastic but minimally promotion-elastic. This strategy makes sense if (1) the market is large; (2) the market is highly aware of the product; (3) the market is price-sensitive; and (4) there is some potential competition. 2. Growth or the Market Acceptance Stage : In this stage, the product is produced in sufficient quantity and put in the market without delay. The demand generally continues to outpace the supply. The sales and profit curves rise often at a rapid rate. Competitors enter in the market in large number of the profit outlook appears to be very attractive. The number of distribution outlets increase, economies of scales are introduced and prices may come down slightly. Sellers shift to “buy -my- brand” rather than “try -my- product” promotional strategy. Annamalai University
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83 MARKETING STRATEGIES IN THE GROWTH STAGE During this stage, the firm tries to sustain rapid market growth as long as possible. This is accomplished through such action as: 1. The firm undertakes to improve product quality and add new product features and models. 2. It vigorously searches out new market segments to enter. 3. It keeps its eyes open to new distribution channels to gain additional product exposure. 4. It shifts some advertising from building product awareness to trying to bring about product conviction and purchase. 5. It decides when the time is right to lower prices to attract the next layer of price-sensitive buyers into the market. 3. Market Maturity : During this stage, sales continue to increase but at a decreasing rate, while the sale curve is levelling off, the profits of both the manufacturer and the retailers are starting to decline because of rising expenditure and lowering or prices. Marginal producers, therefore, are forced to drop out of the market. Price competition becomes increasingly severe, and the producer assumes a greater share of the total promotional efforts in order to retain his dealers. MARKETING STRATEGIES IN THE MATURE STAGE The product manager whose product has settled into a stage of sales maturity is not content to simply defend its current position. He recognizes that good offense will provide the best defense of his product. These basic strategies are available in this stage; market modification, product modification, and marketing mix modification. Market modification : The product manager first looks for opportunities to find new buyers for the product. There are several possibilities.
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