Discuss about the Marketing Management for Product Life Cycle.
Marketing management plays a crucial role in the success of any business. Once a product has been developed, marketing allows the organization to introduce the product to the target market. Every product that is developed by a business goes through a number of stages. These stages include product development, product introduction, product growth, product maturity and finally product decline. There is no fixed time span within which a product shifts from one stage to another. However, the organization needs to develop different marketing strategy for the product during its various life cycle stages. This report highlights upon the marketing strategies adopted by businesses during the introductory stage as well as maturity stage of the product. Relevant examples have also been provided wherever required.
Introduction stage of a product is marked by introducing the product to its target market. During this stage, the costs incurred by the company are very high (Stark, 2015). The product is faced by little or no competition during this stage and the demand for the product needs to be created in the market. At this stage, the business makes little money as customers need to be prompted to buy the product. Marketing strategies at this stage are aimed at creating a demand for the product and reaching out to a maximum number of targeted customers.
During the introduction stage, people are not entirely aware about the existence of the brand. Therefore marketing strategies at this stage must be aimed at generating awareness about the brand. During this stage brands must adopt social media marketing, extensive promotions through sample distributions, celebrity endorsements and digital marketing strategies must be adopted. This will lead to enhanced awareness, improved trust and better acceptance towards the new product.
Various organizations prefer to distribute free samples during this stage in order to make the consumers aware about the product. For example when L’Oreal introduces a new shampoo in the market, they try to distribute a sample sachet of the shampoo at large retail stores. They also give away small bottles of shampoo free along with their existing product. This strategy allows the customers to use the product and also helps in building trust upon the brand.
Social media marketing refers to any kind of marketing done via social media platforms including Facebook, Instagram, Snapchat, Pinterest or twitter (Tuten & Solomon, 2017). Social media marketing is an effective tool to target a large group of people through a single channel. Housing.com is a leading real estate firm which is a perfect example of brands using innovative social media campaigns to promote the product. Social media marketing also allows the business to gain a feedback about the product (Heymann-Reder, 2012). Social media marketing often establishes a two way communication between the organization and its customers. Therefore it is imperative that businesses resort to social media marketing during introduction stage of the product.
Digital marketing refers to the process of marketing a product through digital platforms. The most important steps of digital marketing are search engine optimization and search engine marketing (Armstrong et. al., 2015). Both these processes enable the customers to search for the brand effectively and enhance awareness about the brand. Once a brand has reached its maturity stage, the brand’s SEO and SEM is also ready well established but this process needs to begin from the introduction stage of the product. For example, Cornerstone Shaving of United Kingdom is a startup that caters to the shaving needs of people. They largely resort to digital media marketing in order to reach out to their customers.
Celebrity endorsements are also an impactful strategy to reach out to target customers. Associating the brand with a celebrity who aligns well with the brand’s values helps customers relate with the brand. This strategy can be adopted in any stage of the product’s life cycle. But it is most beneficial during the introduction stage of the product as this is the stage where the brand needs to build trust in the minds of its consumers. Therefore, this is where celebrity endorsement comes into the picture. Justin Bieber has endorsed the music streaming app Spotify since its inception. This has garnered the brand immense trust and Spotify is currently leading various streaming charts.
Billboards and hoardings in various geographical areas are an effective marketing strategy that is used by firms in order to market their products (Kumar, 2012). Billboards are placed in different locations with an aim to enhance awareness about the brand. For example, Subway is a leading fast food chain with branches across the globe. Whenever Subway launches a new product snack or beverage in a particular city, the brand places its ads on the billboards of commercial locations of the city. This allows the passerby’s to be aware of the new product.
Event sponsorships are a great way to reach the public eye. VIVO smartphones were introduced in China and entered the Indian market in 2015. The brand decided to market itself from the next year onwards by being a chief sponsor for the IPL (Indian Premier League) which is one of the most anticipated cricketing tournaments across the globe. Event sponsorships during the introduction stage help in increasing brand awareness. The organizations must be careful about deciding which event they sponsor as the event must align well with the values of the business.
Maturity stage of a product is marked by reduced cost and increased economies of scale. At this stage, sales volumes increase significantly and there is considerable demand for the product. This stage is also marked by severe competition and therefore it is imperative that organization put efforts in gaining a competitive advantage. This stage is marked by market saturation, peaking sales volumes and increasing need for brand differentiation.
Marketing strategies during maturity stage of the product must be aimed at revamping the brand’s image and expanding the brand to newer target markets and geographies. At this stage, it is important that the brand’s marketing strategies enable the brand to sustain the highly competitive market.
In this stage, creating and innovative marketing strategies need to be introduced by the brand. This is where brands must focus on gaining a competitive advantage. Revamping the brand’s image will provide the brand with a fresh start. Nokia has been one of the leading mobile companies across the globe. Nokia discontinued its smartphone production in 2007 owing to less demand. The product had hit maturity and was heading towards decline. In 2013, Nokia was back with a bang and introduced windows operated smartphones. This revamping of the brand’ image earned Nokia more years in the industry.
At the maturity stage, the level of competition in the industry is very high. Therefore at such a stage, it is important brands focus on differentiating their offerings in order to gain customers (Hollis & Brown, 2011). The biggest example of this is Netflix. Netflix is a leading streaming giant. As soon as the brand started facing stiff competition from Hotstar and Amazon Prime Video, Netflix started to revamp its strategy and introduce new content in order to gain a competitive advantage as against other players in the industry. Various Netflix original series have garnered immense appreciation across the globe. This has enhanced the demand for the streaming firm and despite charging a much higher price as compared to its competitors, Netflix continues to gain subscribers.
Once the product has hit maturity, it is understandable that the brand has various customers. Therefore in order to market the product to these customers, businesses must apply relationship marketing strategies. These strategies enable the brands to build relationships with their customers with an aim to target them in a customized manner (Christopher, Payne & Ballantyne, 2013). For example Uber, a leading taxi service has the data of all the riders stored with them. Once the data has been received, the brand tries to target each of these customers by providing them offers and discounts for their most travelled locations. They aim at building long term and mutually beneficial relationships. Customers can avail discounts by referring their friends and family members. Customers can also save their favorite destinations and pool taxis with people travelling in the same area.
Television advertisments have been used a form of promotion since a long time. Television adverts allow the brand to set the right positioning in the minds of the consumer and enhance awareness about the brand in a short span of 2-3 minutes. Television advertisement is extremely productive in reaching out to a large number of customers through a single platform. In the maturity stage, businesses must curate unique and creative television ads in order to gain attention of customers.
Vodafone is a leading telecommunication brand. During 2009, the brand introduced ZooZoo television ads which immediately gained attention and were appreciated across the globe. The advertisements gave the brand a high TOMA score (Top of mind awareness) and helped the brand to demonstrate creativity in its maturity stage.
Once the product hits the maturity stage, event marketing can help the brand in reviving its image and reaching out to wide audience through a single platform. At this stage, the brand needs to be careful about the events that the brand invests in. Sponsoring large scale events will help the brands in gaining the much needed attention while sponsoring small events may backfire the brand. Coca-Cola has been the leading sponsor of Olympics since its inception. This has garnered the brand immense appreciation and has helped Coca-Cola in setting the right positioning in the minds of customers.
Geo targeting allows brands to target customers who are physically near the brand (Burnim & Google, 2013). This process has been gaining traction over the last few years. The aim of geo targeting is to target customers when they are physically closest to the brand. This may further press them to buy the product. This strategy has been largely practiced by Adidas and Puma. The likeliness of seeing an Adidas ad on Facebook or Instagram increases when an individual is close to an Adidas outlet.
Conclusion
A product goes through various stages in its entire life cycle. In order to ensure survival in the market and effectively elongate the entire life cycle of the product, it is imperative that businesses adopt different marketing strategies in different stages of the product life cycle. The introduction stage of the product requires the business to generate awareness about the product and therefore strategies like social media marketing, digital marketing, event sponsorships and distribution of free samples are used. On the other hand, during the maturity stage, the level of competition faced by the product is very high and the product has been there in the market since a long time. At such a stage, the brand needs to revamp its image and give the product a fresh start maybe with a new target market. This requires the brand to adopt strategies like creative television advertising, curating content for billboards and relationship marketing. This will allow the brand to revamp its image in the market and build long term relationships with customers which are mutually beneficial. Therefore at different stages of the product lifecycle, the selection of appropriate marketing strategies is crucial to set the right positioning in the minds of customers.
References
Armstrong, G., Kotler, P., Harker, M. and Brennan, R., (2015). Marketing: an introduction. Pearson Education. United States.
Burnim, J.S., Google Inc, (2013). System and method for targeting advertisements or other information using user geographical information. U.S. Patent 8,554,852.
Christopher, M., Payne, A. and Ballantyne, D., 2013. Relationship marketing. Taylor & Francis.
Daniel, M., Bogdan, G. and Daniel, Z., 2012. The use of event marketing management strategies. Procedia-Social and Behavioral Sciences, 46, pp.5409-5413.
Heymann-Reder, D., (2012). Social media marketing. Addison-Wesley Verlag.
Hollis, N. and Brown, M., 2011. It is not a choice: brands should seek differentiation and distinctiveness. Millward Brown Point of View: April.
Kumar, A., 2012. Dimensionality of Consumer Beliefs toward Billboard Advertising. Journal of Marketing & Communication, 8(1).
Stark, J., (2015). Product lifecycle management. In Product Lifecycle Management (Volume 1) (pp. 1-29). Springer, Cham.
Tuten, T.L. and Solomon, M.R., (2017). Social media marketing. Sage. United Kingdom.
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