Product Life Cycle and Positioning

Lesson Objectives• Identify the 4 stages of the product

life cycle• Describe product positioning

techniques

Product Life Cycle

The stages a product goes through in its life

1. Introductory Stage

• High promotion• Increase

awareness • High production

costs• Least profitable

stage

2. Growth Stage• Increasing sales and profits• Competition emerges• Modifications may be introduced

3. Maturity Stage

• Sales slow or level off• Most money spent combating

competition

4. Declining Stage

• Sales/profits may fall• New strategy chosen:– Sell or license product – promotion

strategy– Find new product uses– Discount – pricing strategy– Regionalize – place strategy–Modernize or alter – product strategy

Product Positioning

Efforts a business makes to identify, place and sell its

products. Attempt to create an image for the product.

Positioning Strategies

• Price (lowest price?)• Quality (best quality?)• Features/Benefits (filling a need)• Relating to the competition• Relating to other products in the

line

Category Management• Process that manages product

categories as individual business units

• Category manager• Planagram– Computer-developed diagram – product display–Maximizes product’s potential

Product Life Cycle and Positioning