Introduction
Branding is products or service’s identification through symbols, signs, a specific name, or a combination of them and differentiates the products or services from competitors. The branded product consists of some attributes, values, culture, benefits, personality, and users as well. Brand products entered the market and pass their life span. Over its lifetime it is introduced, gets its growth ness & maturity, and finally faces declination, this process called product life cycle (PLC ). So a product life cycle has 4 distinct stages:
Introduction Stage: At the very first stage product just launched into the market with large-scale promotional and marketing activities and with its basic features. Here profit is low because costs are high due to the large promotional activities. Customers are more innovative. But the company gets the opportunity to expand their market, as competitors are few so there is a trend to be growth.
Growth Stage: As the markets are satisfied with a new product, the product entered into the growth stage where sales are quickly enlarged. Buyers who purchase earlier, continue to buy and new consumers take initiative to buy if they are motivated by others or any kinds of means. New competitors entered the market with different product attributes that lead to expanding the market. Here profit raises and per customer cost is average, a number of outlet increases.
In this stage due to trade deficit between large market share and maximum current profit. The company faces losing its market dominancy that leads to following the next stage.
Maturity stage: The very part of this stage sale is to increase at a slow rate. This stage is normally longer than previous stages, weak competitors lose their market share and sometimes get out from the market, intensified price completion exists in the market. New competitors entered the market with sophisticated elements and ideas. Therefore, the product moves to the next stage.
Decline stage: In the decline stage product sales shrinkage due to technological advances, the interest of consumers may be shifted or increased competition. Stanton, et. al. (1991) states that “[a]dvertising declines and a number of competitors withdraw from the market” (p.199).
Management strategies for these stages of the product life cycle are as follow: “Successful product life cycle management strategies are (1) predict the shape of the proposed product’s cycle even before it is introduced and (2) at each stage to anticipate the marketing requirements of the following stage” (Stanton, et. al., 1991. p.200).
For the introduction stage: Management strategies are as follows:
- The manager should find out a viable market;
- Offer basic attributes with the products or services;
- The product should be distributed through the selective channel;
- Conduct large marketing promotional campaigns and increase product awareness favorably.
For the growth stage: Management strategies are as follows:
- Manager may cut-price or keep remain same depending on demand level;
- Study the market;
- The promotional campaign should be increased;
- Intensive channel of distributions established;
- Less sensitive to take advantage of high demand.
For the maturity stage: Management strategies are as follows:
- Hold the market through the high promotional campaigns and influence them to switch the product;
- Increase private sales by increasing outlets and make it near to the door of customers;
- Diversify the products.
In 1985, coco-cola find that they face great competition from the Pepsi-cola introduces as sweeter cola. Coca-cola conducts research and on the basis of research findings, the company withdraws its product from the market. After 10 weeks, introduce its century formula as ‘classic coke’ (Armstrong & Kotler, 2006, p.335).
For the decline stage: Management strategies are as follows:
- Redesign the product through adding features, by increasing quality;
- Identified unprofitable outlets;
- Decreasing the sales promotion campaign to reduce cost.
How changing of environmental factors affecting marketing decision in case of product elements
- Cultural factor: in the subcontinent peoples hold strong beliefs, religious norms, and values. Basically, Muslims believe that it is prohibited to take any kind of alcohol coco-cola to have this ingredient. This will change the marketing decision to market the coco-cola in the subcontinent.
- Economic condition: Most of the subcontinent country’s people have low buying power and face inflation frequently. For this reason, coco-cola recently changes its brand shape in India as if is affordable for low buying power consumers.
- Technological factor: Technological development creates a new market. To establish new technology government approval affects marketing decisions. In the subcontinent, (India) when coco-cola established its first plant, the government asked to provide evidence whether it is injurious for heath or not.
References
Armstrong, G., & Kotler, P. (2006). Marketing: An introduction. Upper Saddle River, NJ: Prentice Hall.
Stanton, J. William. et. al., (1991). Fundamental of Marketing. 9th ed, New York: McGraw-Hill.