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PRODUCT LIFE-CYCLE STRATEGIES

Shir Shah fahimID# EC-91-475

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Agenda

1) What is production life cycle 2) Product development stage3) Introduction stage4) Growth stage5) Maturity stage6) Decline stage

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What is product A product is anything that can be offered to a market that might satisfy a want or need

To create successful new products the company must o Understand it’s customer, market, and competitorso Develop products and deliver values to the customers o Products goes through life cycles

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WHAT IS PRODUCT LIFE CYCLE ?

Describes the stages a new product goes through beginning to end.The product life is based upon the biological life cycle for example a person born(introduction) he/she begins.

Growth and become younger and younger and after a long time periodhe/she die out ( decline).

Each product have a different life cycleProduct life cycle shoes revenue earned Its help in new product development planning Its help for forecasting

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Introduction/ Birth Growth Maturity

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Market Low, small Increasing High market Decreasing

Sales Low High Making flat average

Competition Low Average High Average

Business focus

Awareness Market share Customer retention Change

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What is Production life cycle?the process where product introduced to a market, grows up to

maturity and then removed as demand drops gradually to zero

production life-cycle shows the product sales and its profit over its lifetime

production life-cycle have five stages which are product development introduction stagegrowth stagematurity stagedecline stage

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Before entering to the main topic we must to know after launching the new product in market the proper management

required, as we know that every business which is entering to the market the main aim is to generate profit,

the companies want to be in market in more and more time

when a company introduce a product in the market so they invest bundles of money on research and development promoting to that product, and the company want bundle of profit from this product

this is not to say the product life-cycle in not extended there are many product which is in the market for many years .

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Break even : finish with no losses

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Product Development product development starts when the companies develop a new idea

During this stage sales is zero

the companies invested a bundle of money

often the product development or developing a new ideas takes 2 up to 4 years once the product released on the market, their product life cycle is usually about 6 mounts

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Introduction stage/ product launch stage• In this state the new product distributed and its available

for purchase• It’s the most expensive stage of developing new product in

the market• In this stage the firm seeks to build product awareness and

develop a market for the product

• 1) Product: a level quality, and high brand, high trademark• 2) pricing: low price in order to build market share, or high

price to recover development costs.• make a very high awareness about product to the

customers • The size of market and product us small• the sales are low or no sales • no profit• There is very high research and development

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• High distribution and promotion expense.• No more competition, limited competition

Marketing Objectives • create product awareness, high advertisement Marketing strategies • offer a basic product • Build a high distributive• Offer warranty, guaranty and some discount like purchase one

and give one free

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Growth stage• The product life-cycle stage in which the product sales start climbing quickly• In this stage the product is accepted by consumer.• In this many companies set low price in order to increase the sales and attract the peoples

and build a high market share • Better stage for revenue generation• In this strategy there is a very high competitive , and competitor increase • In this stage sales are increasing , and profit increasing

• Product: quality should increase, there should be after sales services • Pricing: a price should set that firm enjoy increasing demand with a low competition • Distribution: cannels should be increased and customer accept the product• Promotion: build a strong awareness.

• Note: as we know that the company expend bundle of money in research and development and promoting of the product, so in this stage the company should give maximum profit

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This stage is very impartment in this stage we will say that productis success or Fail

If the product removed from the market before recovering its cost

This is called a bust

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Maturity • In this stage the product is establish and the main aim of the firm is to maintain the

market share.• Very high competition • There is a peak sales, very high sales • The company try to set the low price or the firm can set the price according to their

competitors • There is very high profit .• In this stage the company should changing characteristics, such as product quality,

style, in order to attract new customers and sustain the old customers

• The company which produce foods items in this stage should introduce new flavors, colors, integrations or package.

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TABASCO• Tabasco sauce was first produced in 1868 by Edmund McIlhenny• It’s a company which produce paper sauces and its age is more than 147 years

and still its young , its because of producing new flavors, and producing new product under name of TABASCO.

• And this company have a strong advertisement in all over the world

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Decline stage

• Fourth and last stage of a product's life cycle• Unable to find new customer for giving the product

and services that product is in decline stage• The company can look or do redesign, repackage the

product • In this stage the product sales decrease and decline• In this stage there is no more profit and no more

sales • In this stage the company should add new features

and finding new uses.•

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Decision Point Stage

Options • Reduce the cost of the product• Stop producing the product• Adding new color, new packaging make it really new •

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The End

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THE END

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What is the main reasons for discontinuing a product Why it is discounting that what was the problem of markets