The whole product marketing exercise should be based on the knowledge that a product lifecycle exists for everything that is introduced into the market.
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The product lifecycle has four distinct stages i.e. from introduction, to growth, to maturity and lastly a decline. As the product moves through each of these stages changes to the marketing situation are experienced and this calls for the requisite alterations to the marketing mix and marketing strategy.
At the introduction stage of a product lifecycle product quality levels and branding are established as are intellectual property aspects like trademarks and patents. The nature of pricing at this instance may be either low to enable market penetration or high to facilitate the recouping of development costs. Promotion exercises largely target early adopters and it is all about creating awareness. Distribution remains selective until customers have been observed to accept the product to feasible levels.
The growth stage of a product lifecycle sees firms endeavor to expand market share and consolidate brand preference. The quality of the product is still maintained and extra features may be added to increase customer preference. The same pricing structure is retained as the firm enjoys the benefits that come with increasing demand and limited competition. The promotional activities that the firm sets out to do are generally aimed at increasing the market share by targeting wider audiences. Distribution channels start being developed thanks to increased product acceptance and demand by customers.
During the maturity stage of the product lifecycle the increasing market share of the previous stage becomes restrained. It is very likely that competitors will have introduced new similar products. The firm will at this stage try to retain its market share while seeking to make maximum profits. The product may be improved in a way to make it better than what competitors are offering. Promotional aspects will largely seek to create awareness with respect to product differentiation and the pricing may be set lower in response to the competition. Distribution activities will see added vigor and the introduction of incentives in a bid to win over customers attracted by the competitors.
In decline the firm may decide to stick with the product and make improvements to it or a new use for it in the market. The firm may also harvest the product by making price reductions and availing it to loyal customers. Alternatively the firm may opt to discontinue the product.
In product marketing the firm must understand what range of products it will offer and who the target customers will be. Informed product marketing also seeks to know how these products will reach the desired customers i.e. through distribution channels and also why these customers will prefer these products as opposed to what competitors offer.