PRODUCT LIFE CYCLE - EXTENSION STRATEGIES Flashcards
What is the product life cycle
The different stages a product goes through in terms of sales volume, from its development through to its discontinuation, and how the sales of a product change over time.
What is the extension strategy
A course of action designed to increase the sales of a product by altering one or more elements of the marketing mix.
What does a product life cycle: sales vs profit
https://docs.google.com/document/d/13wwJN3AbK6r8JH6pilrkQLlfSkBQAPKFPPDIcL9t-VM/edit
This is the product life cycle
Chart that shows what stages
A product goes through in its life
What does the chart look like with an extension strategy
https://docs.google.com/document/d/13wwJN3AbK6r8JH6pilrkQLlfSkBQAPKFPPDIcL9t-VM/edit
This is what the chart would look like after implementing a extension strategy.
The business owners may decide to alter one or more elements of the marketing mix of that product, in order to try and extend the life cycle
An extension strategy occurs at the end of a products life cycle in order to try and prolong the peak sales a product receives. It appears around the maturity and decline phase. The business owners are looking for a way to boost how long the product can stay at its peak and aim to make more sales which leads to more profit.
NOT A TEST - A real life example on an extension strategy
KitKat decided that their ordinary 2 and 4 finger bars were getting to the end of their maturity, and about to hit a decline, so they developed a new product which was the KitKat chunky. The new chunky bar wasn’t hard to produce as the manufacturer just had to make a single finger bigger. But because people were so used to the normal 2 and 4 finger bars, the anticipation for a new looking KitKat bar went off the roof. The sales for the chunky bar were skyrocketing which led to more profit, but also more interest in KitKats other products like the normal 2 and 4 finger bars. That is a real example of KitKat editing the marketing mix.
