product life cycle - chapter 6
TRANSCRIPT
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Chapter 6Product Life-Cycle
StrategiesPrepared by:
Nor Izzuddin Bin NorrahmanLecturer of Management, Banking & Islamic Finance
Astin College
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Introduction…
• After launching the new product,management wants the product to enjoy along happy life.
• It will not sell forever, but the company wantto earn a decent profit to cover the risk andthe effort that they went into when theylaunched it.
• Every product has its own life-cycle althoughthe exact shape and length is not known inadvance.
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Product Life Cycle (PLC)
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Product Development
• Product development begins when the company finds and develops a new-products idea.
• During product development, sales are ZERO and the company’s investment costs mount.
• Income = 0
• Cost >
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Introduction Stage
• Introduction is a period of slow sales growth as the product is introduced in the market.
• Profits are non-existent in this stage because of the heavy expenses of product introduction.
• Income = Costs
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Growth Stage
• Growth is a period of rapid market acceptance and increasing profits.
• Income > Costs
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Maturity Stage
• Maturity is a period of slowdown in sales growth because the product has achieved acceptance by most potential buyers.
• Profit level off or decline because of increased marketing outlays to defend the product against competition.
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Decline Stage
• Decline is the period when sales fall off and profits drop.
• Sale <
• Income <
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• Not all product follow this product life-cycle.
• Some products are introduced and die quickly, others stay in the mature stage for a long, long, long, long, long time.
• Some enter the decline stage and are then cycled back into growth stage through strong promotion or repositioning.
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The PLC concept can
be applied to what are known as
Styles
FashionsFads
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Styles
• Is a basic distinctive mode of expression.
• Examples: House, clothes, art.
• Once a style is invented, it may last for generations, passing in and out of the vogue.
• A style has a cycle showing several periods of renewed interest.
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Fashions
• A fashion is a currently accepted or popular style in a given field.
• Example:?
• Fashion tends to grow slowly, remain popular for a while, then decline slowly.
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Fads
• Fads are fashions that ENTER quickly, are adopted with great zeal, peak early, and decline very quickly.
• They last only a short time and tend to attract only limited following.
• Examples?
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PLC Characteristics
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PLC Strategies
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The End…question?