product life cycle Flashcards
what are 3 ways a business can slow down the decline of the product?
adapt the product
sell to a wider market
rebrand the product
what does a product life cycle diagram look like?
SEE PAGE 50 OF REVISION GUIDE
the introduction phase of the diagram
product launched and put on sale
usually with advertising and sale promotion
will involve high costs to start with
sales will be low as customers aren’t aware of the product resulting in low profits
the growth stage of the diagram
demand increases until the product becomes established
enjoying rapid growth in sales and profits
the maturity stage of the diagram
demand reaches its peak
as product popularity grows businesses will try to make the product more widely available
towards the end the products becomes saturated and has no room to expand.
sales are high but profit starts to fall resulting in products being discounted to keep sales high
the decline stage of the diagram
start to fail as rivals may be taking over
firm will spend less money and as sales fall it will start making a loss
the research and development stage
first stage
used to develop ideas and turn it to a marketable product
one aims is to make cost-effective materials and methods to use.
scientific research is vital for this
what are some product extension strategies
adding more or different features- may increase demand
using new packaging- may be more appealing, attract new target market
target new markets-new markets extend life of a product
changing advertisements-more people become aware of the business and product
lower price-reduce it or make special offers
what is differentiation
when a business decides to make the products or services different from the competition
how can you differentiate a product
branding
USP
location
design
customer service
quality
product mix
