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25 Cards in this Set
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What are the implications of Life Cycle theory?
Products have a limited life
Product sales pass through distinct stages each with different challenges and opportunities
Profits rise and fall at different stages
Products require different strategies in each life cycle stage
Describe the Life Cycle Patterns?
1. growth slump maturity pattern: sales grow rapidly upon intro and then fall to a petrfied level sustained by late adoptors buying the product for the first time and early adopters replacing it.(kitchen items)
2. Cycle-Recycle pattern:Pharma drugs. agressive promotion, producing the first cycle, then sales decline, then they do another push casuign a second cycle( smaller in length and profit)
3. Scalloped Pattern-sales pass through a succession of life cycles based on discovering of new products characteristics, uses or users. eg nylon.- used as hosiery., for shirts, for carpeting, boat sales, new uses discovered
What are the main strategies and typical characteristics at various stages of the life cycle?
1. Introduction: Charac: low sales, high cost per customer, negative profits,innovator customers, few competitors
Strat- product- offer basic product, price- charge cost plus, dist-selective,comm- product awareness and trial among adopters and dealers
2. growth-charac- rapid rise in sales, average cost per cust, rising profits, cust- early adopters,comp- growing.Strat-product extensions, service warranty, price to penetrate market, dist-intensive distribution, comm-build awareness and mass market interest-max market share
3. Maturity-charac-peak sales, low cost per cust,high profits, cust-middle majority,compet-stable # begining to decline,strategies- diversify brands and item models,price tomatch our best competitors,build more intensive distribution, stress brand differnces and benefits, encourage brand switching-defend marketshare and make money
Marketing Program Modification
4. Decline- declining sales, low cost customers, declining profits,laggards, competitors- declining, strategies- phase out weak products, cut price, distribution-selective pahse out unprofitable outlets, comm- reduce minimal level needed to reatian hard-core loyals-milk the brand, don;t spend $
Increase firm’s investment.
Maintain the firm’s investment level.
Decrease the firm’s investment level.
Harvesting (“milking”) the firm’s investment.
Divesting the business quickly
What's the difference between Skimming and Penetration?
Rapid skimming strategy
Slow skimming strategy
Rapid penetration strategy
Slow penetration strategy
Improve product quality, add new features, and improve styling
Add new models and flanker products
Enter new market segments
Increase distribution coverage
Shift from product-awareness advertising to product-preference advertising
Lower prices to attract the next layer of price-sensitive buyers
What's the Concept of Competition?
Number of sellers and degree of differentiation
Entry, mobility, and exit barriers
Degree of vertical integration
Degree of globalization
Describe Market Share, Mind Share, Heart Share.
Share of market- competitors share of target market
Share of mind-the % of customers who named the competitor in responding to: "Name the 1st company that comes to mindin this industry"
Share of heart- the % of customers who named the competitor in this statement: Name the company you prefer to buy the product from
What are the main Market Structures?
Market leader-Expand Market,Defend Market Share,Expand Market Share
Market challenger-Attack leader,Status quo
What are the Approaches / strategies at for various market positions?
Market Leader:Expanding the Total Market
New-market segment strategy
Defending Market Share
(2) Flank defense
(3) Preemptive defense
(4) Counteroffensive defense
(6) Contraction defense
Defining the Strategic Objective and
It can attack the market leader
It can attack firms of its own size that are not
doing the job and are underfinanced
It can attack small local and regional firms
Choose a General Attack Strategy
Choose a Specific Attack Strategy Edit
Define the Market Challenger Attack Strategies 1) Frontal attack
(2) Flank attack
(3) Encirclement attack
(4) Bypass attack
(5) Guerilla attack
Whats the Product development processes?
. Idea generation- is the idea worth considering? if no drop
2. idea screening- is the idea compatible with company objectives, strategies ans resources? if no drop
3. Concept devlopement and testing- would consumers try it?if no drop
4. marketing strategy developement- can we find a cost-effective strategy?if no drop
5.Business analysis- will it meet the profit goal? if no drop
6. Product development- have we got a technically and commercially sound product? if no drop
7. Market testing- have they met sales expectations? if no send to product development or drop
8. Commercialization- are sales mtg expectations? if no-modify mktg program-if yes- lay future plans
What are the main issues in product development?
Shortage of ideas
Social and governmental constraints
Cost of development
Faster required development time
Shorter product life cycles
Product line management
Line Featuring & Line Pruning Edit
Describe line stretching? Down-Market Stretch
What are Market testing approaches?
Product Idea Rating Device
Communicability and believability
User targets, purchase occasions, purchasing frequently
Costs- fixed vs variable
Costs that don’t
vary with sales or
Costs that do vary
directly with the
level of production.
What are some pricing strategies and approaches?
Sealed bid pricing
What are someRetailer types?
Product positions and distribution strategeis
Functions of organizations and distribution channels
Develop and disseminate persuasive communications
Reach agreements on price and terms
Acquire funds to finance inventories
Provide for storage
Provide for buyers’ payment of their bills
Oversee actual transfer of ownership
MFG, wholesale, jobber retail, consumer
Whats the Communication Process?
What are some message problems?
What are Roles of various media?
Advertising Public, Pervasive, Expressive, Impersonal
Communication, Incentive, Invitation
Public Relations & Publicity Credibility, Surprise, Dramatization
Personal Confrontation, Cultivation, Response
Direct and Interactive Marketing Nonpublic, Customized, Up-to-Date, Interactive
what's the Budget development process
Stage in the product life cycle
Market share and consumer base
Competition and clutter
Establish the budget:
What to consider when choosing the right promotional mix
Type of Product Market
Consumer Readiness to Make a Purchase
Stage in the Product Life Cycle
Deciding on Reach, Frequency, and Impact
–How many exposures will produce audience awareness depends on the exposures’:
Public Relations functions?
Marketing Public Relations Functions
Tasks Aided by Public Relations
Launching new products
Repositioning a mature product
Building interest in a product category
Influencing specific target groups
Defending products that have encountered public problems
Building the corporate image in a way that reflects favorable on products
Assist in product launches
Assist in repositioning mature products
Build interest in a product category
Influence specific target groups
Build corporate image
Promotions – types, benefits
Collection of incentive tools, mostly
short term, designed to stimulate
quicker or greater purchase
of particular products or services
by consumers or the trade
Entice Consumers to
Try a New Product
Lure Customers Away
From Competitors’ Products
Get Consumers to “Load Up’
on a Mature Product
Hold & Reward Loyal
Persuade Retailers or
Wholesalers to Carry a Brand
Give a Brand Shelf Space
Promote a Brand in
Push a Brand to Consumers