Life cycle of products strategies
The life-cycle of a product has four distinct phases including introduction, growth maturation and declination. Each stage is accompanied by modifications in the product's market position. There are a variety of marketing strategies at each stage to keep the lifespan of your product.
Introduction strategies for products
Strategies for marketing used during the beginning stages of a campaign comprise:
Rapid skimming- launching the product at a very high cost and at a high-level of promotional value
Slow skimming - launching the item at a very high cost and a low level of promotion
*Rapid penetration *- launching a product for sale at a bargain price and a significant promotional campaign
*Low penetration *- offering the product at the lowest price with minimal marketing
In the beginning it is recommended at:
Establish a distinct brand identity
- Find the right partners for promoting your product
- Set up consumer tests or send samples or trials to the key markets you want to target.
- The price of the product or service should be at the highest price you think you are able to sell it and reflect the level of quality that you provide
- It is also possible to restrict the product or service to a certain category of buyer Being selective may increase the demand.
Product Introduction strategies
At the beginning of the process it is important to focus on creating a base for your product. You should pay attention to the following elements:
- Pricing
- Distribution
- Promotion
Pricing your product or service
The first step is to start with pricing the highest price you think it is possible to reach. It is also possible to look into a price-skimming approach - charging a high cost for a relatively short period of time after you have launched an innovative, new or substantially improved product. Skimming attracts those who are willing to spend more money to be the first customers to experience an innovative product. It is possible to lower prices after the demand from early adopters decreases.
A penetration pricing approach may be the best option for companies that are entering new markets or attempting to expand on a tiny market share. It is the practice of setting prices that are lower than the more expensive prices to attain an extensive, but not dominating market share.
Distribution
The distribution of your product should be targeted and restricted to a certain category of consumers up to the point that your offering is recognized. Additionally, you must look at different distribution strategies for different times of the product's lifespan, such as new items for different seasons in a clothing store.
Promotion
It is important to establish brand recognition in the early stages. It is a good idea to work with a branding or a communications company when you are developing an item to create a brand that is strong.
It is possible to use samples or trial rewards to encourage early adopters to your product. Promoting the product in the beginning can also assist in convincing prospective resellers to carry your products. Different strategies for marketing work best at different points in the lifecycle of the product. Find out more about different strategies for the life of a product.
Introduction to the Life Cycle of Product to determine the profitability
It is probable that during the initial stage your sales will be modest until the people are aware of your product's or service's advantages. Because of the cost of advertising and the low initial sales, it's likely that you will not earn immediate money or even find that your product is generating negative revenues. But, you can be able to make up for it with growing revenue during the maturation and growth stages of the product's life cycle.
Strategies to increase the growth of products
Strategies for marketing used during the growth phase generally aim to increase profit. Some of the most popular strategies you can try include:
- Improving product quality
- Adding new features to your product or support services to increase your market share
- Entering new markets segments
- Ensuring that the price is acceptable to keep demand and profits at a high level
- Expanding distribution channels to deal the increasing demand
- Shifting marketing messages away from product awareness to preference for the product
- Using price-shopping to increase you are making too little profit
The growth phase is the time when you can expect to see increasing profits, sales and market share. Your strategy should aim to make the most of the opportunities.
Strategy for assessing the maturity of a product
If your sales reach their peak your product enters the stage of maturation. This typically means that the market for your product will be overcrowded and you may discover that you have to alter your strategies for marketing to extend the lifespan that your products will have. Strategies that are commonly used to help at this point fall under any of these categories.
*Market modification *- This includes creating new market segments and redefining target markets winning over customers of competitors as well as changing non-users
Product modification-for instance changing or improving the quality of your product's features and pricing, as well as distinguishing the product from others with the markup.
Product Decline Strategies
In the final stages of the product's life cycle, you'll observe decreasing sales and lower profits. It could be due to changes in the preferences of consumers as well as technological advancements and alternative products available. At this point you need to determine the best strategy to adopt. If you're looking to save money, you could:
- Reduce your promotional expenses on the merchandise
- Decrease their number of distribution centres who offer them.
- Introduce price reductions to encourage customers to purchase the product.
- Find a different use for the product
- Maintain the product and keep the product and wait for competitors to pull from the market.
- You can harvest the service or product before putting it down
Top comments (0)