More 2 Marketing

Susan
More to marketing. Welcome to more 2 marketing and podcast and marketing product and everything in between. I’m your host Susan, and today we’re asking the question to process to really have a life cycle and. If they do, how do we understand it? So the answer is yes, products do have a life cycle and it’s typically divided into 4 stages. You have the introduction, the growth maturity and the decline. This concept represents the different phases. Of how a product goes about its life, and we’re going to delve into each. One of these topics. So the very first one is introduction. This stage begins with the product launch sales start slowly as customers become aware of the product and the marketing effort focus on creating the awareness. Growth in in essence is the sales start to really increase as more customers adopt the product advertising focus on building the marketing share this time instead and competitors might even start entering the market. In general, the maturity stage is where sales reach their peak during the stage and the market becomes potentially saturated. There’s competition, intensification, all of those things are happening. The company might be more focused on product diversification or improvements to maintain their market. Share and potentially differentiation in market of their product. The final stage is to climb, sales begin to decrease due to the market saturation. Change of customers preference driven technology advancements. Companies may decide to discontinue the product or reposition it or reposition it in the market. Now the introduction stage itself, if we look at that one in more detail now is a product life cycle marks a product launch into the market. Now here’s how it operates, along with the pros and cons. OK, so the introduction stage operations is approx. Life cycle involving critical activities during the initial product launch. So that is your product development which is creating and refining the product to meet market needs and demands. You need to do a lot of market research, conducting analysis to understand the target markets, preferences needs and potential demand. Taste and prototyping. Evaluating prototypes, ensuring functionality quality, and addressing any initial issues. Which cookie debugging? Market introduction. So if feelers out there, launch the product into the market through a strategic marketing campaign. Also, this stage includes building the awareness, occurring the awareness, or even someone like maybe advertising or promotions and other marketing initiatives or even be partnerships. Distribution establishment, so setting up a distribution channels to make the product available to your customers where they need it. And naturally, you’re going to also have to develop your pricing strategy, determining the initial price strategies that you’re going to go with. To attract those early adopters and set the products perceived value. There’s also the limited availability, so initially the product might not be available to everyone and might only have limited quantities, or might only be available in specific regions. These operations, when it comes to your actual first stage. Is to establish the perks presence, current demand and garner initial market acceptance by introducing the offerings to potential customers. It is very important in this stage. To use it to identify the limited competitions. Hopefully you’ve only got a few competitors initially exist. If none, allowing the product to gain initial market share. Put big investment into heavy marketing where you can to focus on creating awareness and generating demand through advertising promotional activities. There will be high costs. Generally speaking, so investments are higher due to that research, development and marketing expenses, and because you’re only starting out. There’s also that retention of low sales, so keep that in mind as well, because typically it’s lower due to the limited customer awareness. The actual number available and the initial market penetration. There’s a whole. Pile of pros. To this initial stage as well. See there’s innovation. So there’s opportunity to do something groundbreaking, innovative and setting new industry standards. Early adopters, it really does attract early adopters interest when trying out new products. Market entry so establishes market presence and secures that initial market share where you could be the owner for quite a while if you’re lucky. Potential differentiation. The change to create unique to create a unique selling proposition and brand differentiation is there for you in this early stage as a pro and customer engagement generally speaking early customer feedback will be higher because people are very excited. And it also allows improvements based on those initial user experiences. But as we’ve got pros, we’ve always got cons. So is high risk taking in a lot of cases because there’s that uncertainty regarding the market acceptance and the long term success. As we mentioned, the high costs, there is some significant investments with low initial returns. Potentially, there’s also limited sales because of the volume. You might have to market or slow growth. In. Market competitive pressure. Depending on how easy it is to replicate, you could get competitors very fast. And resource strength, heavy investments without immediate profitability may strain your resources as well. So let’s go through some examples. So Tesla’s electric cars, they enter the market with innovative electric vehicle technology and they really push the envelope. The iPhone launch was definitely revolutionising for the smart mobile phone industry. And the introduction of it was very well received. Another example of one that’s gone really well, where it’s disrupted a market is Nintendo Wii gaming console. It really did have that unique motion sensors control backwards day. When net stream when Netflix decide to move to streaming, it introduced streaming as a new concept in the entertainment industry. That hasn’t been really, really brought to life yet. Another new one that’s now really starting to get traction, if it’s still in that early stages is the plant based meat products. This is way that they’re entering a market to cater for the growth of people that are more health and environmentally conscious. But now we’re going to move into the growth stage. The growth stage in a product as we mentioned signifies a phase of rapid expansion and increased demand for the product. There are a number of areas to keep in mind though during this phase. So sales search specific growth in sales and market demand due to an increased cost, consumer awareness and acceptance. So you could be prepared when you get to that. Age. Potentially is also expanded market. Your product might gain wider recognition and attract a larger customer base depending. What it is? Profits grow yope. Revenue and profit escalate duty come as a scale, and the efficiency of the productions you find smarter, faster, better ways to create it, and then you be able to maximise those opportunities with the volumes. Competitive landscape. While the rivals will come in, because now you may be at a stage where you. Can. Be copied. And then you’ve got to look at what that will impact for consumers having more opportunities to get a proximal.
In this phase of growth, there are pros, so you’ve got the increased revenue as we mentioned. Potentially even higher revenue and the higher market share will help that economies of scale make a huge difference leading to cost efficiency and improve margins. And if you played your cards right during this stage of growth, you’re also going to have. Stronger foothold in the markets, you’ll have market domination. There are comments so the heightened increase in your awareness out there and people are aware you can now have more competition. So that will intensify that rivalry. There may be cost challenges. Demand might strain resources and impact production costs. And also products imitation. Replicating my competitors may happen, and that might challenge your market share. So some of these examples is definitely going to be where you’ve got Facebooks as social media. It exploded for user growth during its early years. You’ve got Netflix again, where it’s really gained a huge market share, but now it’s definitely been moving into its next phase. That you, everyone would have seen how big that was when it was going gangbusters. So those two two examples indicate to us that they are currently in there growth stage and potentially even moving into mature stage. But what is mature stage? The mature stage is all about stability, competition and marketing focus. Stability is where the product reaches a stable phase with consistent demand sales. But the market is also becoming saturated. Competition is high. There are multiple firms offering various or companies offering very similar products, leading to a price stabilisation as well. Marking focus so companies focus on differentiation strategies and marketing campaigns to really set their product apart to maintain that market share. Pros in this mature stage are definitely that revenue stability. Steady sales often lead to the consistent revenue streams and sustainable for that period of time and profitability. You may also have a pro of customer loyalty, because whatever your product is is established that reputation and brand loyalty. Cost efficiency. Economies of scale have been optimised, so therefore your production process is contribute to that reduced cost, but with the cons. Market satirization. Means potential limited growth in some areas. Competitive pressure may lead to price wars and impact your profit margins depending on how you’ve you’ve created your business and your structured pricing. And then innovation challenges. Sometimes when you hit the maturity stage, it’s difficult to introduce innovative features. Coca Cola, despite being a mature product, is maintaining A dominant market share. It does try to do some innovative different things where if it’s advertising partnerships or even. Some new products. Toyota Corolla is a car model that’s just that has been sustained in its market presence for decades. That’s another example. You could even look at things like a software Microsoft Windows operating system. It’s matured, but it consistently does updates and it’s actually got quite a stable market position. There are detergent brands out there that have been around for a very long time. They are very mature and they’re still very stable because they’ve still got those stable sales and market share happening and that also crosses over to breakfast cereals too. We’ll have some that have been there for quite a long time. They’ve been quite stabilised and it hasn’t really had many changes to them, not even the formula. Final stages of decline. Stage. As the name does suggest, it’s from the product is heading towards its end of life. This could be because of a number of reasons like demand has decreased substantially. Pro is actually obsolete like like any technology could have come in and wiped it out. Or the business has deemed that during to due to diminishing profits, it no longer wants to continue. That product line. So decreased demand, the sales and marketing demand of the product has steadily declined. Market obsoleteness so technology advancements or other changes for the customer preferences make this progress attractive. Profit reduction. Margins diminished diminished due to the decrease in sales and the higher cost to maintain the products or even maybe some of the features of the product or updates? Pros profit has been maximisation done, so companies might still generate profits for maintaining the product with that reduced expense, so you could continue in some cases. Niche markets. There’s an opportunity to cater just for a niche market that’s still interested in the client product and still make a profit. However, we know there’s going to be Conti, which is the declined. Revenue. Lots of sales dropping, leading to a decrease in revenue and profits. Resources. So they’re now spending too much time under client product. There’s no point investing because that’s hindering investment into new products innovations. The brain image itself that could be a con. If you keep a product in a prolonged presence in a declining market, it may tarnish that brand overall. So some of the ones you may or may not remember, they have been through decline and are definitely declined. Typewriters. They have been rendered obsolete with the creation and advancement of computers. VHS tape, beta tapes, all those tapes based out due to the emergence of DVDs and streaming services. Fax machine. Majority of them are all gone now because it’s digital communication channels like emails have taken over. And for many, many people, the BlackBerry phone and those old school. Even the ones that did snake therefore been replaced by smartphones that have touch screens colour and can do almost anything. Everything on them like a mini computer. So the point of understanding the life cycle is so that you can make better and smarter business decisions by knowing where you are in comparison to your market, your business profits and everything you are able to better plan ahead to what your next stage is and what your next development might be. Understanding this life cycle helps businesses make all those strategic decisions. They can allocate resources more efficiently and effectively, plan marketing strategies, and decide whether to invest in new product development or focus on existing ones. Thank you for listening to this podcast from more to Marketing. Don’t forget to like to hear more fabulous podcasts. More to marketing.