5.5 Flashcards
product life cycle
tool for mapping out the four stages of product commercial life – launch, growth, maturity, decline
diffusion of innovations (list them)
visionaries and enthusiasts:
1 innovators
2 early adopters
mainstream adopters:
1 early majority
2 late majority
resisters:
1 laggards
innovators characteristics
drive change
arent afraid to fail
high tolerance for risk and uncertainty
early adopters characteristics
embrace change
like to be first to try, use, buy
try out new ideas in careful way
early majority
accept change (sooner than late majority)
adopt if practical – weigh pros and cons
wait until it has been successful in practice
late majority
skeptics
accept change (later than EM)
adopt after proven
often adopt out of necessity, not choice (eg if ‘everybody’ is doing it)
laggards
value tradition
suspicious of new innovations
often wait until forced to adopt
feel threatened/uncomfy by uncertainty and change
list key stages of product life cycle
introduction
growth
maturity
decline
introduction stage
only innovators will know of its existence => low sales
little to no competition
more effort put into marketing to get to next part of cycle
growth
word starts to get out, early adopters start to engage with the product => growth in sales and profit
cost per customer falls
competing products will be introduced later in growth stage, impacting profits
maturity
peak sales
profits high
cost per customer lowest
competitors released products => crowded marketplace; more choice for customers
decline
advanced tech may now have been developed, replacing current one
falling sales, profits
cost per customer low
consumers no longer want to purchase product
less units are produced
product versioning
creating variations of product, different models, different price points etc – can allow a company to maintain a pioneering strategy and constant revenue stream
advantages of product versioning
improved consumer choice
more options
maximised company profits (larger market appeal)
disadvantages of product versioning
some products may be less popular
some consumers may choose cheaper option even if more expensive one is within budget
more products = more environmental damage
obsolescence
product becomes obsolete, outdated and no longer used, needed
4 areas of obsolescence
planned
style
functional
technological
planned obsolescence
product becomes outdated as a conscious act to ensure continuing market or to ensure new safety stuff/technology can me incorporated
deliberate strategy to force customers into repurchasing. companies r criticised for it bcs its an effort to get more money, ignoring the waste generated
planned obsolescence strategies
crappy materials
engineering product to fail at some point
restricting ability to repair product
style obsolescence
changing fashions and trends which can result in product no longer being desirable
functional obsolescence
products wear out and break down, without possibility of repair. product can become obsolete if it no longer functions efficiently, if parts are no longer available
technological obsolescence
an existing technology quickly falls out of use as a new technology replaces it
