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LifebuoyProduct life cycle &
Marketing Strategies
By: Akash Trivedi Ankit Jain
Ankit Chandak Paul Dinakar
Vamsi Krishna Ankur Jain
Introduction
One of the oldest brand of HUL & positioned as health & hygiene soap.
Introduced in 1895 as a disinfectant soap especially when the country was severely affected by diseases like typhoid plague & yellow fever
Lifebuoy was the only soap brand to cross 100,000 tonnes of sales in a single year
The Brick Red Soap with its beautiful jingle have carried the message of health across the length and breadth of the country making it the largest selling soap brand in the world
Marketing mix
Product• Launched as carbolic red
disinfectant soap
• Initially meant only for health & hygiene
• Moved on to freshness , beauty care, nature care & deodorant
• Rejuvenated product cycle by increasing line /length
Price• Targeted lower & middle
income group mainly the rural consumers
• Priced at comparatively low price to attract more customers
• Moved on to high prices following the process of trading-up
Place• With strong distribution
channel mainly targeted rural market.
Promotion• Initially positioned as a
male brand then moved on to family brand
• Used health programs for promotion to make people aware about health & hygiene
Why a product life cycle?A company’s positioning and differentiation strategy must change
as the product, market, and competitors change over the time.
When we say that a product has a life cycle we assert four things:
i. Products have a limited life.
ii. Products sales pass through different stages, each posing different challenges, opportunities and problems to the seller.
iii.Profits rise and fall at different stages of the product life cycle.
iv.Products require different marketing, financial, manufacturing, purchasing, and human resource strategies in each life – cycle stages.
Product Life Cycle
Product life cycle is the stages over which a product develops & affects the sales and profits over time.
The five stages of each product lifecycle are:
Product development
Introduction
Growth,
Maturity
Decline.
Different patterns of PLC
Sales and Profits Over the Product’s Lifetime
Product Life Cycle
Monopoly Monopolistic Oligopoly Pure Competition
SalesSales
CostsCosts
ProfitsProfits
Marketing ObjectivesMarketing Objectives
ProductProduct
LowLow
High cost per customerHigh cost per customer
NegativeNegative
Create product awareness and trialCreate product awareness and trial
Offer a basic productOffer a basic product
DistributionDistribution Build selective distributionBuild selective distribution
PromotionPromotion Heavy to entice product trialHeavy to entice product trial
Summary of Characteristics, Objectives, & Strategies
Introduction Stage of the PLC
SalesSales
CostsCosts
ProfitsProfits
Marketing ObjectivesMarketing Objectives
ProductProduct
PricePrice
Rapidly risingRapidly rising
Average cost per customerAverage cost per customer
RisingRising
Maximize market shareMaximize market share
Offer extension, service, warrantyOffer extension, service, warranty
Penetration strategyPenetration strategy
DistributionDistribution Build intensive distributionBuild intensive distribution
PromotionPromotion Reduce to take advantage of demandReduce to take advantage of demand
Summary of Characteristics, Objectives, & Strategies
Growth Stage of the PLC
SalesSales
CostsCosts
ProfitsProfits
Marketing ObjectivesMarketing Objectives
ProductProduct
PricePrice
PeakPeak
Low cost per customerLow cost per customer
HighHigh
Maximize profits while defending market shareMaximize profits while defending market share
Diversify brand and models Diversify brand and models
Match or best competitorsMatch or best competitors
DistributionDistribution Build more intensive distributionBuild more intensive distribution
PromotionPromotion Increase to encourage brand switchingIncrease to encourage brand switching
Summary of Characteristics, Objectives, & Strategies
Maturity Stage of the PLC
SalesSales
CostsCosts
ProfitsProfits
Marketing ObjectivesMarketing Objectives
ProductProduct
PricePrice
DecliningDeclining
Low cost per customerLow cost per customer
DecliningDeclining
Reduce expenditures and milk the brandReduce expenditures and milk the brand
Phase out weak itemsPhase out weak items
Cut priceCut price
DistributionDistribution Selective: phase out unprofitable outletsSelective: phase out unprofitable outlets
PromotionPromotion Reduce to minimum levelReduce to minimum level
Summary of Characteristics, Objectives, & Strategies
Decline Stage of the PLC
Three special categories of PLC
Continued…
A Style is a basic and distinctive mode of expression appearing in a field of human endeavor. Styles appear in homes, clothing, art etc.
A Fashion is a currently accepted or popular style in a given field. Fashion pass through four stages: Distinctiveness, emulation, mass fashion, decline.
Fads are fashions that comes quickly into public view , are adopted with great zeal, peak early, and decline very fast.
Four IntroductoryMarketing Strategies
Rapid-Rapid-skimmingskimmingStrategyStrategy
Rapid-Rapid-skimmingskimmingStrategyStrategy
Rapid-Rapid-penetrationpenetrationstrategystrategy
Rapid-Rapid-penetrationpenetrationstrategystrategy
Slow-Slow-penetrationpenetrationstrategystrategy
Slow-Slow-penetrationpenetrationstrategystrategy
Slow-Slow-skimmingskimmingstrategystrategy
Slow-Slow-skimmingskimmingstrategystrategy
PricePrice
LowLow
HighHigh
PromotionPromotionHighHigh LowLow
Marketing strategies for Growth stage
During the growth stage, the firm uses several strategies to sustain rapid market growth.
Improves product quality and adds new features and improved styling.
Adds new models and flanker products(i.e., products of different sizes, flavors, and so forth that protect the main product).
Enters new market segments Increases its distribution coverage and enters new
distribution channels. Shifts from product- awareness advertising to product-
preference advertising. Lowers price to attract the next layer of price – sensitive
buyers.
Marketing strategies for Maturity stage
Three useful ways to change the course for a brand are market, product, and marketing program modification.
Market Modification
Expand the no. of brand users
Convert nonusers into users
Enter new market segments
Attract competitors’ customers
Continued..
Increase the usage rate among users
Find out new ways to use the product
Find out on what occasions consumers by more products
Product modificationQuality improvement:
Aims at increasing the product’s functional performance.
Eg: Aashirvaad, Annapoorna, Pillsbury, Naturefresh
Feature improvement
Aims at adding new features, such as size, weight, materials, additives, and accessories, that expand the product’s performance, versatility, safety, or convenience.
Style improvement
Aims at increasing the product’s esthetics appeal.
Eg; New car models, New Coke
Marketing modification
Prices: Price cut by means of discounts,special prices etc.
Distribution: Adding more distribution channels to increase the penetration?
Sales Promotion: Rebates,warranties,gurantees,gifts & contests,rebates,price-off coupons.
Services: Providing more assistance to customers.
Decline Stage
• Drop unprofitable customers
• Cost cutting measures
• Line pruning
• Harvesting
• Divesting
Limitations of PLC
• Like human beings products does not have a very predictable life so the concept of product life cycle is not well suited for forecasting of product sales.
• It yields a product oriented picture rather than a market oriented picture.
• Product life cycle may become self fulfilling ,means if sales peak & then decline managers may misinterpret it as decline phase & therefore cut the advertising budget and thus making a further decline.