2. PRODUCT LIFE CYCLE
It is the life of a product in the market with respect to
business/commercial costs and sales measure.
To say the product has a life cycle is to assert four things :
✔ Product has a limited life
✔ Product sales pass through distinct stages, each posing
different challanges , opportunities and problems to the
seller.
✔ Profit rise and fall at different stages of the product life
cycle.
✔ Products require different marketing , financial,
manufaturing , purchasing in each life cycle stages.
6. INTRODUCTION STAGE DETAILS
● Slow sales growth, offering of basic product
● Limited distribution
● Negative or low profits
● Little or no competition
● Customers have to prompted to try products (awareness
creation)
● Intensive personal selling to channel members
● Promotional expenditure are at their higher ratio to sales
● Price tend to be high because cost is high
● Concept of pioneering advantage
● Firms focus on those buyers who are most ready to buy
7. MARKETING STRATEGY IN THE
INTRODUCTION STAGE
● High price
● High promotion
● Large market unaware of product
● Low price intense competition
● High promotion price senitivity
● Large market unaware customrer
● High price low promotion
● Market failure of product
● Competition non intense
Low price
Low promotion
Large Market , aware customer , price sensitive
RAPID
SKIMMING
RAPID
PENETRATION
SLOW
PENETRATION
SLOW
SKIMMING
8.
9. GROWTH STAGE DETAILS
● Rapid climb in sales
● Purchase by early adopters
● Increase in public awareness, intensive distribution
● Bringing product extensions , warrenty and services
● New competitiors enter , attracted by the opportunities
● Prices fall slightly or ramain as it is, depending upon demand
increase and increased competition
● Promotional expenditure maintained the same or at slightly
increased level to meet competition and to educate the market
● Decline in the promotion-sales ratio
● Increase in profit because of economies of scale and learning
effect
10. STRATEGIES IN GROWTH STAGE
Focus shifts towards brand building
Adding new features and improving quality/style/look
Entering new market segments
Increased advertising
Price reduction to attract new buyers
Increasing distribution coverage
Example – cadbury celebration , taj mahal tea- wah taj
Bringing product extensions, warrenty and services
12. MATURITY STAGE DETAILSMATURITY STAGE DETAILS
● Sales volume peaks & market saturation is reached at some point.
● Costs reduced but prices also tend to drop beacuse of
competiton.
● The stage normally lasts longer than the previous stage and
posos big challenges to marketing management as profits go
down.
● Majority buyers make repeat purchases, laggards join them
● Can be divided into three phases: growth , stable & decline
maturity
GROWTH PHASE : Sales growth rates start to decline, no new
distribution channels to fil , new competitive forces emerge.
STABLE PHASE: Sales flatten on a per capita basis because of
market saturation, future sales governed by population growth &
replacement demand.
DECAYING STAGE: The absolute level of sales start to decline,
customers begin to other products, intensified competition.
15. DECLINE STAGE DETAILS
● Decline in sales because of technological changes, shift in
consumer tastes and increased competition
● Costs become counter-optimal
● Laggards and repeat purchase driven sales
● Overcapacity,increased price cutting,reduced promotion &
profit erosion
● Most of the product class usually die at this stage.
● Withdrawl from market or reduction in number of products
offered
● But, it is also possible to extend the life of product by various
means.
●
16. STRATEGIES IN DECLINE STAGESTRATEGIES IN DECLINE STAGE
● Appropriate strategy depends upon exit barrier, industry's
relative attractiveness , product category and the
companies competitive strength.
● Different strategies used :
●
HARVESTING
Gradually reducing a
Product or business
Cost while trying to
maintain sales
LIQUIDATING
Bringing the product to
an end and dropping of
the assets
DIVESTING
Selling the product to
another firm if it has
Strong distribution and
residual goodwill.
17.
18. EXTENDING PLCEXTENDING PLC
When a product reaches theWhen a product reaches the
maturity stage, followingmaturity stage, following
strategies can be adopted tostrategies can be adopted to
extend the life of a product:extend the life of a product:
● Price reduction
● Repackaging and redesigning(to
make them seem new and attract
new attention)
● Launch in new markets
● Direct selling
● Revised promotion (to gain new
audience and remind the current
once.
● Adding value (new features to the
current product.)
19. SIGNIFICANCE OF PLCSIGNIFICANCE OF PLC
● There are three levels of PLC
product levelproduct level ( eg: dell XPS 15 laptop)
category levelcategory level ( desktop , laptop, netbook ,tablet PC)
Brand levelBrand level ( HP, dell , apple , sony , lenovo )
● Determines the revenue earned
● Helps the firm in being proactive
● Contributes to strategic marketing planning
● May help the product to identify when aproduct needs support ,
redesign , revitalization , withdrawl etc
● May help in new product development planning or creating a
marketing mix for success of brand and product.
20. USES OF PLCUSES OF PLC
➔ Product planning
➔ Maintaining a proper balance of product at different stages
of PLC
➔ Preventing cannibalization
➔ Pre-planning product launch
➔ Making investment decisions on products
➔ Choosing appropriate entry and exit strategy
➔ Prolonging the profitable phase( by highlighting new
uses , adding new users, etc)
➔ Shortening the product development time
➔ Customer management
21. LIMITATION OF PLC CONCEPTLIMITATION OF PLC CONCEPT
PLC pattern are too variable in shape and duration to be generalized
Markerters can seldom tell which stage their product is in.
For specific products, the duration of each PLC stage is
unpredictable
A product may apprear to be mature when actually it has reached a
plateau prior to another upsurge.
The PLC pattern is the self-fulfilling of marketing stategies and that
skillful marketing can in fact lead to continued growth
Use of PLC may lead to inappropriate actions sometime.
Because of there limitations , strict adherence to PLC can lead a
company to misleading objectives and strategies prescriptions.
22. CASE STUDY ON PLC OFCASE STUDY ON PLC OF
DIFFERENT PRODUCTSDIFFERENT PRODUCTS
23. CADBURYCADBURY
● Cadbury chocolate was started in birmingham in 1824 by john
cadbury.
● Cadbury dairy milk came up with the mix of milk and chocolate
tray which is pretty much how the product still is
● No drastic change in the recipe of the product but the packaging
and the representation & prominance of “ glass and half of milk '
has changed over a period of time.
24. CADBURY – IndiaCADBURY – India
● Began its operation in 1948 by importing
chocolates and then re-packing them before
distribution in the indian market.
● Cadbury has 5 company owned manufacturing
facilities at-
● Thane (mumbai) , induri ( pune) , malanpur
(gwalior) , bangalore and baddi ( himachal
pradesh)
● 4 sales offices
New delhi, Mumbai , Kolkata , Chennai
25.
26. Brand IdentityBrand Identity
● In 1984 cadbury dairy milk is ntroduced in india
● Cadbury dairy milk is in the maturing stage of the
product life cycle.
● It currently has a market share of 70% in the
chocolate market and way ahead of its
competitors.
● There is a high degree of brand awareness.
● The colour purple & the “glass half full of milk”
logo is amongst the most recognized logo.
27. COMPANIES/COMPETITORSCOMPANIES/COMPETITORS
● In the indian market
cadbury faces
competition from
NESTLE AND AMULNESTLE AND AMUL
● There are more
several local brands
like candicocandico , sweetsweet
world .world .
●
28. INTRODUCTION STAGEINTRODUCTION STAGE
● In the 1980s , CDM was positioned as ' the perfect
expression of love' captured in memorable copy
● During the early 1990s , communicating it as '
real taste of chocolate'
● In 1994 came the path-breaking 'real taste of life
campaign.
● CDM redefined it as the perfect expression of
spontaneous , shared good feeling and '
providing real taste of life' experience.
● The strategy paid off: brand cadbury grew by
over 50% in sales volume
29. GROWTH STAGEGROWTH STAGE
● 1998- growth for the product deaalt with
popularising consumption in the social context.
● Especially in more traditional setting like –
wedding .
● With the campiagn “khaanein vaalo ka khaanein
ka bahana chahiye....” featuring cyrus broache ,
CDM aimed to substanially increase penetration
level.
● The campiagn was launched in tandem with the
award winning “ kuchh khaas h....” campiagn
● The brand penetrated into small towns and sales
grew more by 40%
30. MATURITY STAGEMATURITY STAGE
● The “ worm controvercy” resulted in cadbury's brand
image taking a beating.
● Sales declined to 30%
● They had to recall a batch of chocolates . Cadbury then
rebuilt the trust of people by launching project “ vishwas”
in 2004
● Redisgn of packaging took place
● With Amitabh bachana they launched their new
positioning of “ kuch meetha ho jae...”
● Then “ phle taarekh hai..” campiagn talked about the
importance of dairy milk & celebrating your pay on pay-
day.
● Then “subh Aarambh” ads bought back the charm of
cadbury again to the market with great share .
31. DECLINE / NEW PRODUCTDECLINE / NEW PRODUCT
DEVELOPMENTDEVELOPMENT
● The cadbury brand due to its great marketing and
continuous innovation strategies never lost its hold in
market.
● They keep on reinventing their products according to
customer needs.
● Like in the case of dairy milk , when they get to know
their market share of the product will decline, they
came up with celebration packs and thenintroduced
the sub brand silk and now silk bubbly in the market.
● Similarly in the case of PERK , they came up with
“thodi si pet pooja, kabhi bhi, kahi bhi”, they
introduced chotta perk , perk XXL , perk glucose.
63. After a drastic decline in the product the Company adopt
repositioning Strategy....
64. Harpal Singh and Gulshanbeer Kaur of Delhi became the first proud owners
of the first Maruti 800 car in 1983. The couple bought the car for Rs 47,500
and its keys were handed to them by the then Prime Minister INDRA
GANDHI
65. Harpal Singh receives the car keys of the first Maruti800
from Indira Gandhi on December 14, 1983.(Company
archives)
66. Production of Maruti Suzuki 800 Stopped, End
Of 30-Year-Old Remarkable Journey.......
• Maruti Suzuki's ever loved creation Maruti 800 became history on Saturday, with the
company announcing that its production had been stopped in the country.
• The car, which taught Indians how to drive has finally reached the end of the road
after staying connected to the Indian middle -class families for three decades. The
company completely stopped the production and rolled out the last of its 800 model on
18 January. However, Maruti, India's largest car maker will continue to sell the spare
parts of 800 to its customers for next eight to ten years as per rules, said the
company."Now on the 18th of January we have stopped the M-800 production
completely. We have to keep all of them (dies and moulds) for the spare parts
requirement. We have to continuously meet the customer requirements. That is our
duty to make sure that they get all the parts," said C V Raman, Executive Director
MSIL, according to PTI.
67. •The remarkable journey of Maruti on Indian roads started in 1983, and since then the company
has sold over 2.5 million Maruti 800s in the country. The car had also found market in number
of other countries like Nepal, Bangladesh and Sri Lanka. Harpal Singh, an Indian Airlines
employee from New Delhi, was the first Indian who took the key of the dream coupé from the then
Prime Minister Indira Gandhi.
•Though the charm of 800 never faded away from the auto market and numerous modifications
were made to it, it was difficult for the company to keep up with the increasing competition in the
market with just one car. However, the phase out of the car was something that was expected as the
company halted the sale of car in 13 major cities in India including Kanpur, Bangalore,
Hyderabad, Pune, Ahmedabad, Agra and Surat from 2010 due to the stricter emissions
regulations.
•The car that made Maruti what it is today is now a history. But the incredible journey of Maruti
800 would not fade in to oblivion any time soon for sure .
68. The last Maruti 800 rolling off the line from Maruti's factory at Gurgaon. It
was despatched on January 23 to Rani Motors, Shillong.
69. End of the road for India's beloved Maruti
800, company stops production
• In the midst of all the glitz and glamour of the Auto Expo, an event of perhaps far
greater emotional relevance has missed everybody's attention. India's largest car
maker Maruti Suzuki has given a quiet and solemn burial to Maruti 800 - the car
that taught India how to drive and made Maruti what it is today.
• The last Maruti 800 rolled off the assembly line in Gurgaon on January 18 this year
that brings to a close a remarkable 30-year-old journey for the nameplate. The 800 was
the mainstay for the company till 2004 and remains the most omnipresent car on
Indian roads with sales of over 29,50,000 units.Maruti had already discontinued the
car from 13 major cities in India including the four metros - Delhi, Mumbai, Kolkata
and Chennai - back in 2010 when stricter emission norms came into effect. It was still
sold in the rest of the country where Bharat Stage III emission norms are in place. The
complete phase out comes a year ahead of the roll out of Bharat Stage III norms in the
remaining cities, towns and villages of the country..
70. • With an average production of 1,700 cars every month in the last
few months of its life, the last few units are already with the
dealer and expected to be sold out within this month."When we
started the project, none of us knew how the reception would be,"
said RC Bhargava, chairman, Maruti Suzuki India. "We had
started with a very low ambition. When we were setting up a
100,000 units plant, people said it won't even sell 40,000 units.
The booking of 125,000 at the beginning proved all the skeptics
wrong. 800 is the car that made Maruti."
• At a price of Rs 50,000 at the time of its launch, the M800 was a
coming of age car for India and offered an entirely different
experience to the consumers as compared to Ambassadors, Premier
Padminis and the Standard Gazels that ruled the streets then. It
was small and peppy, offered features like air conditioning, was
fuel efficient and quickly became a symbol of mobility in India.
71. • The car also showed great resilience to competition over the
years. Despite having an unsophisticated 796cc petrol engine
and a shape that has not changed much over the years, it sold
more than many of its younger counterparts even in the last
few years. In 2013, its sales of 20754 was more than Tata
Nano's tally of 18,447 units."We have an emotional connect
with the vehicle, but at some point, you have to take hard
decisions," said CV Raman, executive director (engineering)
at Maruti Suzuki.
• The end of a journey of the car was perhaps inevitable but its
impact on India would be everlasting. And who can vouch for
it better than its first owner Delhi's Harpal Singh whose
M800 continues to chug along on the roads.
