3.4d - Product Life Cycle Flashcards

1
Q

Product life cycle definition

A

The different stages that a product goes through

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2
Q

What can cause the product life cycle to be short?

A
  • Fast rate of technological change
  • High degree of innovation
  • Customer’s tastes are changing quickly
  • It is badly marketed
  • It is a fashion item
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3
Q

How can the product life cycle be used?

A
  • Forecast future sales
  • Assist marketing strategies
  • Identify deviations from the norm
  • Aid analysis of product portfolio
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4
Q

What are the different stages of the product life cycle?

A
  1. Development
  2. Introduction
  3. Growth
  4. Maturity
  5. Decline
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5
Q

What happens in the development stage of the product life cycle?

A
  • Research

- Test marketing

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6
Q

Is a profit or a loss made in the introduction stage of the product life cycle?

A

Possible losses due to heavy promotional spending

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7
Q

What happens in the growth stage of the product life cycle?

A
  • Sales start to rise but there is still high promotional spending
  • Competitors are attracted
  • Product is improved
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8
Q

What happens in the maturity stage of the product life cycle?

A
  • Customer loyalty is established

- Promotional spending may fall but more competition may appear

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9
Q

What are the different extension strategies that can be used?

A
  • New market segment
  • Modify product
  • Change product image
  • New geographical market
  • Change promotion
  • Change price
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10
Q

Balanced portfolio definition

A

A portfolio in which there is a variety of products at different stages in the product life cycle

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11
Q

Disadvantages of the product life cycle:

A
  • The shape and duration of the cycle varies

- It is difficult to recognise exactly where a product is in the life cycle

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