營銷管理（亞洲版 第6版）英文課件 科特勒 Chapter 11 Competitive Dynamics、Chapter 12 Setting Product Strategy

BuildingStrongBrands2

CompetitiveDynamics11LearningIssuesforChapterElevenHowcanmarketleadersexpandthetotalmarketanddefendmarketshare?Howshouldmarketchallengersattackmarketleaders?Howcanmarketfollowersornicherscompeteeffectively?Whatmarketingstrategiesareappropriateateachstageoftheproductlifecycle?Howshouldmarketersadjusttheirstrategiesforaneconomicdownturn?3ChapterOutlineTobealong-termmarketleaderisthegoalofanymarketer.Today’schallengingmarketingcircumstances,however,oftendictatethatcompaniesreformulatetheirmarketingstrategiesandofferingsseveraltimes.Economicconditionschange,competitorslaunchnewassaults,andbuyerinterestandrequirementsevolve.Differentmarketpositionscansuggestdifferentmarketstrategies.4ChapterOutlineThechapterexaminestherolecompetitionplaysandhowmarketerscanbestmanagetheirbrandsdependingontheirmarketpositionandstageoftheproductlifecycle.Competitiongrowsmoreintenseeveryyear—fromglobalcompetitorseagertogrowsalesinnewmarkets,andonlinecompetitorsseekingcost-efficientwaystoexpanddistribution,toprivate-labelandstorebrandsprovidinglow-pricealternativesandbrandextensionsbymega-brandsmovingintonewcategories.Forthesereasonsandmore,productandbrandfortuneschangeovertime,andmarketersmustrespondaccordingly.5CompetitiveStrategiesforMarketLeadersWecangainfurtherinsightbyclassifyingfirmsbytherolestheyplayinthetargetmarket(seeFigure11.1):MarketLeaderMarketChallengerMarketFollowerMarketNicherAmarketleaderhasthelargestmarketshareandusuallyleadsinpricechanges,new-productintroductions,distributioncoverage,andpromotionalintensity.Althoughmarketersassumewell-knownbrandsaredistinctiveinconsumers’minds,unlessadominantfirmenjoysalegalmonopoly,itmustmaintainconstantvigilance.6Figure11.1:HypotheticalMarketStructure7MaintainingVigilanceintheCompetitiveMarketplaceMarketingInsight:PokémonGo:AGame-ChangerforNintendo?discussestheupsanddownsofNintendoandtheworldwidecrazeofPokémonGo,whichmaybringNintendotoitsnextphaseofgrowth.8ExpandingTotalMarketDemandThedominantfirmnormallygainsthemostwhenthetotalmarketexpands.ABCstandstogainthemostbecauseitisthemarketleaderinsuchsauces.IfABCcanconvincemoreIndonesianstoaddmoresweetchilisaucetotheirdishesandforallmeals,ABCwillbenefitconsiderably.9ExpandingTotalMarketDemand10AsthemarketleaderinIndonesianfoodsauces,ABCstandstogainthemostbyexpandingthetotalmarketdemand.NewCustomersAcompanycansearchfornewusersamongthreegroups:thosewhomightuseitbutdonot(market-penetrationstrategy),thosewhohaveneverusedit(new-marketsegmentstrategy),thosewholiveelsewhere(geographical-expansionstrategy).11FindingNewUsers12Romancegamesaregainingpopularity,makingfemalegamersanincreasinglyimportantmarketforvideo-gamecompanies.Japan’svideo-gameindustry—Thetraditionallymale-dominatedvideo-gamemarketinJapanisseeingincreasedpatronagefromfemalegamerswhoareinterestedinotome–romancegames.Thesewomenareattractedtoplayouttheirromanticescapadesinrichlystoriedsocialgames.Theygettofantasizethementheywant.Expertsexpectsuchfemale-orientedgamestocontributemoretotheoverallgamingindustry.Opportunitiesincludeturningmanga,graphicnovels,intointeractivegamesbecausefemale-orientedcomicsaccountforalargemajorityofJapan’se-bookmarket.SocialnetworkslikeGreestandstobenefit.GreedevelopsandrunsgamesforitsFacebook-likeserviceinJapan.MoreUsageUsagecanbeincreasedbyincreasingtheamount,level,orfrequencyofconsumption.Increasingtheamountofconsumptioncansometimesbedonethroughpackagingorproductdesign.Largerpackagesizeshavebeenshowntoincreasetheamountofproductthatconsumersuseatonetime.“Impulse”consumptionproductssuchassoftdrinksandsnacksfindthatusageincreaseswhentheproductismademoreavailable13MoreUsage—IncreasingFrequencyIncreasingfrequencyofuseinvolveseither

identifyingadditionalopportunitiestousethebrandinthesamebasicwayoridentifyingcompletelynewanddifferentwaystousethebrand.14AdditionalOpportunitiestoUsetheBrandTogenerateadditionalusageopportunities,amarketingprogramcancommunicatetheappropriatenessandadvantagesofusingthebrand.Anotheropportunityariseswhenconsumers’perceptionsoftheirusagediffersfromreality.Formanyproductswithrelativelyshortlifespans,consumersmayfailtoreplacetheproductinatimelymannerbecauseofatendencytooverestimatethelengthofproductiveusage.15AdditionalOpportunitiestoUsetheBrandAnotherstrategymightbetoprovideconsumerswithbetterinformationoneither(1)whentheproductwasfirstusedorwouldneedtobereplaced,or(2)thecurrentlevelofproductperformance.AnExampleofGillette.EachGillettecartridgefeaturesabluestripethatslowlyfadeswithrepeateduse.Afteraboutadozenshaves,itfadesaway,signalingtheusertomoveontothenextcartridge.16NewWaystoUsetheBrandThesecondapproachistoidentifycompletelynewanddifferentapplications.Forexample,foodproductcompanieshavelongadvertisednewrecipesthatusetheirbrandedproductsinentirelydifferentways.LeeKumKee,aHongKong-basedmanufacturerofChinesesauces,providesrecipesonwhatdishestocookusingitssauces.17ProtectingMarketShareWhiletryingtoexpandtotalmarketsize,thedominantfirmmustactivelydefenditscurrentbusiness.Themostconstructiveresponseiscontinuousinnovation.Theleaderleadstheindustryindevelopingnewproductandcustomerservices,distributioneffectiveness,andcostcutting.

Comprehensivesolutionsincreaseitscompetitivestrengthandvaluetocustomers.18ProactiveMarketingInsatisfyingcustomerneeds,wecandrawadistinctionbetweenresponsivemarketing,anticipativemarketing,andcreativemarketing.Aresponsivemarketerfindsastatedneedandfillsit.Ananticipativemarketerlooksaheadtoneedscustomersmayhaveinthenearfuture.Acreativemarketerdiscoverssolutionscustomersdidnotaskforbuttowhichtheyenthusiasticallyrespond.Creativemarketersareproactivemarket-drivingfirms,notjustmarket-drivenones.19ProactiveMarketingManycompaniesassumetheirjobisjusttoadapttocustomerneeds.Theyarereactivemostlybecausetheyareoverlyfaithfultothecustomer-orientationparadigmandfallvictimtothe“tyrannyoftheservedmarket.”Successfulcompaniesinsteadproactivelyshapethemarkettotheirowninterests.Insteadoftryingtobethebestplayer,theychangetherulesofthegame.20ProactiveMarketingSkillsAcompanyneedstwoproactiveskills:responsiveanticipationtoseethewritingonthewall,aswhenIBMchangedfromahardwareproducertoaservicebusiness,creativeanticipationtodeviseinnovativesolutions,aswhenPepsicointroducedH2OH(asoftdrink-bottledwaterhybrid).Notethatresponsiveanticipationisperformedbeforeagivenchange,whilereactiveresponsehappensafterthechangetakesplace.21ProactiveMarketingCompaniesProactivecompaniescreatenewofferstoserveunmet—andmaybeevenunknown—consumerneeds.Atonetime,Sonyengagedinsuchproactivemarketing.22ProactiveMarketingCompanies23Sony—Sonyhasintroducedmanysuccessfulnewproductsthatcustomersneveraskedfororeventhoughtwerepossible:Walkmans,VCRs,videocameras,andCDs.Atthattime,Sonywasamarket-drivingfirm,notjustamarket-drivenfirm.AkioMorita,itsfounder,onceproclaimedthatSonydoesnotservemarkets;Sonycreatesmarkets.TheWalkmanisaclassicexample:Inthelate1970s,AkioMoritawasworkingonapetprojectthatwouldrevolutionizethewaypeoplelistenedtomusic:aportablecassetteplayerhecalledtheWalkman.Engineersatthecompanyinsistedtherewaslittledemandforsuchaproduct,butMoritarefusedtopartwithhisvision.ProactiveMarketingCompaniesProactivecompaniesmayredesignrelationshipswithinanindustry,likeToyotaanditsrelationshiptoitssuppliers.Ortheymayeducatecustomers,asBodyShopdoesinstimulatingthechoiceofenvironmentalfriendlyproducts.24UncertaintyManagementCompaniesneedtopractice“uncertaintymanagement.”Proactivefirms:ArereadytotakerisksandmakemistakesHaveavisionofthefutureandofinvestinginitHavethecapabilitiestoinnovateAreflexibleandnon-bureaucraticHavemanymanagerswhothinkproactively25DefensiveMarketingEvenwhenitdoesnotlaunchoffensives,themarketleadermustnotleaveanymajorflanksexposed.Theaimofdefensivestrategyistoreducetheprobabilityofattack,divertattackstoless-threatenedareas,andlessentheirintensity.Speedofresponsecanmakeanimportantdifferencetoprofit.26Figure11.2:SixTypesofDefenseStrategies27SixDefensiveStrategiesPositionDefense—Positiondefenseinvolvesoccupyingthemostdesirablemarketspaceinthemindsoftheconsumer,makingthebrandalmostimpregnable.

FlankDefense—Themarketleadershoulderectoutpoststoprotectaweakfrontorsupportapossiblecounterattack.Pre-emptiveDefense—Amoreaggressivemaneuveristoattackfirst,perhapswithguerrillaactionacrossthemarket—hittingonecompetitorhere,anotherthere—andkeepingeveryoneoffbalance.28SixDefensiveStrategiesCounteroffensiveDefense—Incounteroffensive,theleadercanmeettheattackerfrontallyorhititsflankorlaunchapincermovement.soitwillhavetopullbacktodefenditself.MobileDefense—Inmobiledefense,theleaderstretchesitsdomainovernewterritoriesthroughmarketbroadeningandmarketdiversification.ContractionDefense—Sometimeslargecompaniescannolongerdefendalloftheirterritory.29ExampleofFlankDefenseStrategy30Shiseido—ItsmainfocusinChinaistomakeoveritsupmarketAuprésbrandspecificallyfortheChinesemarket.TocatertorisingpurchasingpoweramongChineseconsumers,itrepackagedtheAupréslinebyaddingadeluxeversionandamen’sskincarelinecalledJS.ItalsoemphasizeditsattentiontoservicebyofferingaspecialcounterindepartmentstoreswherecustomerscanfreelysamplecosmeticssomethingthatisstillquiteuncommoninChina.Additionally,ShiseidoispushingitslowerendnonprestigecosmeticbrandssuchasZaandPureMildinChinatoflankitscosmeticline.ExampleofPre-emptiveDefenseStrategyShiseidoprotectstheweakfrontofitsAuprésbrandbyofferingsamplingservices,andflankingitwithalowerendbrandssuchasZaandPureMild.31Pre-emptiveDefenseStrategyAcompanycanlaunchapre-emptivedefenseinseveralways.Itcanwageguerrillaactionacrossthemarket—hittingonecompetitorhere,anotherthere—andkeepeveryoneoffbalance;oritcantrytoachieveagrandmarketenvelopment.Itcanintroduceastreamofnewproducts,makingsuretoprecedethemwithpreannouncements—deliberatecommunicationsregardingfutureactions.Preannouncementscansignaltocompetitorsthattheywillhavetofighttogainmarketshare.32CounteroffensiveDefenseStrategyInacounteroffensive,theleadercanmeettheattackerfrontallyorhititsflankorlaunchapincermovement.Aneffectivecounterattackistoinvadetheattacker’smainterritorysothatitwillhavetopullbacktodefendtheterritory.Anothercommonformofcounteroffensiveistheexerciseofeconomicorpoliticalclout.33MobileDefenseStrategyInmobiledefense,theleaderstretchesitsdomainovernewterritoriesthatcanserveasfuturecentersfordefenseandoffensethroughmarketbroadeningandmarketdiversification.Marketbroadeninginvolvesshiftingfocusfromthecurrentproducttotheunderlyinggenericneed.ThecompanygetsinvolvedinR&Dacrossthewholerangeoftechnologyassociatedwiththatneed.34MarketDiversificationMarketdiversificationinvolvesshiftingintounrelatedindustries.WhentobaccocompanieslikeReynoldsandPhilipMorrisacknowledgedthegrowingcurbsoncigarettesmoking,theywerenotcontentwithpositiondefenseorevenwithlookingforcigarettesubstitutes.Insteadtheymovedquicklyintonewindustries,suchasbeer,liquor,softdrinks,andfrozenfoods.35ContractionDefenseStrategyLargecompaniessometimesrecognizethattheycannolongerdefendalloftheirterritory.Thebestcourseofactionthenappearstobeplannedcontraction(alsocalledstrategicwithdrawal):givingupweakerterritoriesandreassigningresourcestostrongerterritories.36IncreasingMarketShareMarketleaderscanimprovetheirprofitabilitybyincreasingtheirmarketshare.Gainingincreasedshare,doesnotautomaticallyproducehigherprofits,especiallyforlabor-intensiveservicecompaniesthatmaynotexperiencemanyeconomiesofscale.Becausethecostofbuyinghighermarketsharethroughacquisitionmayfarexceeditsrevenuevalue,acompanyshouldconsiderfourfactorsfirst.37IncreasingMarketShare38HarbinbeerbecameanacquisitiontargetforforeignbeerseyeingtoexpandtheirmarketshareinChina.Chinesebreweries—Chinaistheworld’sbiggestbeermarket.ItsfourlargestbreweriesareSnow,Tsingtao,Harbin,andYanjing.HarbinBrewerywascaughtinabeerbrawlbetweenAnheuser-BuschandSABMiller.Theformerboughta29percentstakeinHarbinBeerandthereactionfromSABMillerwasswift.Itlaunchedahostiletakeoverbidtoprotectitsexisting29percentstakeinHarbinBeer.Eventually,SABMillerdroppedits$550millionbidafterAnheuser-Buschlauncheda$720millioncounteroffer.BothglobalbeermakersareinterestedinHarbinBeerbecausetheywanttoexpandtheirmarketshareandhaveabiggerbiteoftheChinamarket.Otherinternationalbreweriesfollowed.Belgium’sInterbrewboughtseveralbreweriesnearShanghaitocaptureaprominentpositioninChina’stworichestprovinces,GuangdongandZhejiang,whileScottishandNewcastlehaveastakeinChongqingBreweries.Overthepastdecade,therehavebeenmorethan80acquisitions.TsingtaotookoverXinImmense,WestLake,andTaiyuanJiahebreweries.FactorsInvolvedinIncreasingMarketShareThepossibilityofprovokingantitrustactioninthesamecountries.Jealouscompetitorsarelikelytocry“monopoly”ifadominantfirmmakesfurtherinroads.Economiccost.Figure11.3showsthatprofitabilitymightfallwithmarketsharegainsaftersomelevel.Intheillustration,thefirm’soptimalmarketshareis50percent.Thecostofgainingfurthermarketsharemightexceedthevalueifholdoutcustomersdislikethecompany,areloyaltocompetitors,haveuniqueneeds,orpreferdealingwithsmallersuppliers.39FactorsInvolvedinIncreasingMarketShareThedangerofpursuingthewrongmarketingactivities.Companiessuccessfullygainingsharetypicallyoutperformcompetitorsinthreeareas:new-productactivity,relativeproductquality,andmarketingexpenditures.Theeffectofincreasedmarketshareonactualandperceivedquality.Toomanycustomerscanputastrainonthefirm’sresources,hurtingproductvalueandservicedelivery.40Figure11.3:TheConceptofOptimalMarketShare41OtherCompetitiveStrategiesFirmsthatoccupysecond,third,andlowerranksinanindustryareoftencalledrunner-up,ortrailingfirms.Thesefirmscanadoptoneoftwopostures.Eachcanattacktheleaderandothersinanaggressivebidforfurthermarketshareasmarketchallengers,ortheycanplayballandnot“rocktheboat”asmarketfollowers.42MarketChallengerStrategyManymarketchallengershavegainedgroundorevenovertakentheleader.ToyotatodayproducesmorecarsthanGeneralMotors.Challengerssethighaspirations,leveragingtheirresourceswhilethemarketleaderoftenrunsthebusinessasusual.43DefiningtheStrategicObjectiveandOpponents(s)Amarketchallengermustfirstdefineitsstrategicobjective.Thechallengermustdecidewhomtoattack:Itcanattackthemarketleader.Itcanattackfirmsofitsownsizethatarenotdoingthejobandareunderfinanced.Itcanattacksmalllocalandregionalfirms.Itcanattackthestatusquo.44ChoosingaGeneralAttackStrategyWecandistinguishamongfiveattackstrategies:FrontalattackFlankattackEncirclementattackBypassattackDiversifyingintounrelatedproducts.Diversifyingintonewgeographicalmarkets.Technologicalleapfroggingintonewtechnologies.Guerrillaattacks45FrontalAttackStrategyInapurefrontalattack,theattackermatchesitsopponent’sproduct,advertising,price,anddistribution.Theprincipleofforcesaysthatthesidewiththegreatermanpower(resources)willwin.Amodifiedfrontalattack,suchascuttingpricevis-à-vistheopponent’s,canworkifthemarketleaderdoesnotretaliateandifthecompetitorconvincesthemarketthatitsproductisequaltotheleader’s.46FlankingAttackStrategyAflankattackcanbedirectedalongtwostrategicdimensions—segmentalandgeographic.Thesegmentalattackinvolvesservinguncoveredmarketneeds,asJapaneseautomakersdidwhentheydevelopedmorefuel-efficientcars.Inageographicattack,thechallengerspotsareaswheretheopponentisunderperforming.47ExampleofFlankingAttackStrategy48Holdingontoitslaurelsinthephotographicfilmmarket,andnotpressingoninthedigitalphotographybusiness,ledtoKodak’sbankruptcy.Kodak—EastmanKodakledthedevelopmentoffilm-basedphotography.Italsoinventeddigitalphotography.However,becauseofitsnear-monopolystatusinthephotographicfilmindustry,itrestedonitslaurelsandthepowerofitsbrand.Itwasnottookeenindevelopingthedigitalphotographybusinessthatithadinvented.Itseemedthatitwanteddigitalphotographytofailsothatitsfilmphotographybusiness,inwhichitwastheleader,couldthrive.In2012,Kodakfiledforbankruptcy.ChallengerssuchasFujifilm,innovatedacrossalargerarrayoftechnologiesandembraceddigitalphotographymorewholeheartedly.FlankingStrategyAflankingstrategyisanothernameforidentifyingshiftsinmarketsegmentsthatarecausinggapstodevelop,thenrushingintofillthegapsanddevelopthemintostrongsegments.Flankingisinthebesttraditionofmodernmarketing,whichholdsthatthepurposeofmarketingistodiscoverneedsandsatisfythem.Flankattacksareparticularlyattractivetoachallengerwithfewerresourcesthanitsopponentandaremuchmorelikelytobesuccessfulthanfrontalattacks.49EncirclementAttackTheencirclementmaneuverisanattempttocaptureawidesliceoftheenemy’sterritorybylaunchingagrandoffensiveonseveralfronts.Itmakessensewhenthechallengercommandssuperiorresourcesandbelievesaswiftencirclementwillbreaktheopponent’swill,inmakingastandagainstanarchrival.50BypassAttackThemostindirectassaultstrategyisthebypass.Itmeansbypassingtheenemyandattackingeasiermarketstobroadenone’sresourcebase.Thisstrategyoffersthreelinesofapproach:diversifyingintounrelatedproducts,diversifyingintonewgeographicalmarkets,andleapfroggingintonewtechnologiestosupplantexistingproducts.51BypassAttackStrategy–TechnologicalLeapfroggingIntechnologicalleapfrogging,achallengerpatientlyresearchesanddevelopsthenexttechnologyandlaunchesanattack,shiftingthebattlegroundtoitsterritory,whereithasanadvantage.GoogleusedtechnologicalleapfroggingtoovertakeYahoo!andbecomethemarketleaderinsearchengines.52GuerrillaAttacksGuerrillaattacksconsistofsmall,intermittentattackstoharassanddemoralizetheopponentandeventuallysecurepermanentfootholds.Theguerrillachallengerusesbothconventionalandunconventionalmeansofattack.Theseincludeselectivepricecuts,intensepromotionalblitzes,andoccasionallegalaction,toharasstheopponentandeventuallysecurepermanentfootholds.Aguerrillacampaigncanbeexpensive,althoughadmittedlylessexpensivethanafrontal,encirclement,orflankattack,butittypicallymustbebackedbyastrongerattackifthechallengerhopestobeattheopponent.53ChoosingaSpecificAttackStrategyAnyaspectofthemarketingprogramcanserveasthebasisforattack,suchaslower-pricedordisconnectedproducts,neworimprovedproductsandservices,awidervarietyofofferings,andinnovativedistributionstrategies.Achallenger’ssuccessdependsoncombiningseveralstrategiestoimproveitspositionovertime.54Market-FollowerStrategiesProductimitationmightbeasprofitableasastrategyofproductinnovation.

Theinnovatorbearstheexpenseofdevelopingthenewproduct,gettingitintodistribution,andinformingandeducatingthemarket.55Market-FollowerStrategiesTherewardforallthisworkandriskisnormallymarketleadership.However,anotherfirmcancomealongandcopyorimproveonthenewproduct.Althoughitprobablywillnotovertaketheleader,thefollowercanachievehighprofitsbecauseitdidnotbearanyoftheinnovationexpense.56Market-FollowerStrategiesTherearepatternsof“consciousparallelism.”Theopportunitiesforproductdifferentiationandimagedifferentiationarelow;servicequalityisoftencomparable;andpricesensitivityrunshigh.

Mostfirmsdecideagainststealingoneanother’scustomers.Instead,theypresentsimilarofferstobuyers,usuallybycopyingtheleader.Marketsharesshowhighstability.

57StrategiesUsedbyMarket-FollowersAmarketfollowermustknowhowtoholdcurrentcustomersandwinafairshareofnewcustomers.Eachfollowertriestobringdistinctiveadvantagestoitstargetmarket—location,services,financing.Becausethefollowerisoftenamajortargetofattackbychallengers,itmustkeepitsmanufacturingcostslowanditsproductqualityandserviceshigh.Itmustalsoenternewmarketsastheyopenup.Thefollowerhastodefineagrowthpath,butonethatdoesnotinvitecompetitiveretaliation.58FourBroadStrategiesCounterfeiter: Thecounterfeiterduplicatestheleader’sproductandpackage andsellsitontheblackmarketorthroughdisreputabledealers.Cloner: Thecloneremulatestheleader’sproducts,name,and packaging,withslightvariations.59FourBroadStrategiesImitator: Theimitatorcopiessomethingsfromtheleaderbutmaintains differentiationintermsofpackaging,advertising,pricing,or location.Theleaderdoesnotmindtheimitatoraslongasthe imitatordoesnotattacktheleaderaggressively.Adapter: Theadaptertakestheleader’sproductsandadaptsorimproves them.Theadaptermaychoosetoselltodifferentmarkets,but oftentheadaptergrowsintothefuturechallenger.60CounterfeitingProblemsinAsiaMusicrecordfirms,LouisVuitton,andRolexhavebeenplaguedwiththecounterfeiterproblem,especiallyinAsia.See“MarketingInsight:CounteractingCounterfeiting”.61CounterfeitsarecommoninAsia.Market-NicherStrategiesAnalternativetobeingafollowerinalargemarketistobealeaderinasmallmarket,orniche.Firmswithlowsharesofthetotalmarketcanbehighlyprofitablethroughsmartniching.Suchcompaniestendtoofferhighvalue,chargeapremiumprice,achievelowermanufacturingcosts,andshapeastrongcorporatecultureandvision.62NicheMarketingNichershavethreetasks:creatingniches,expandingniches,andprotectingniches.Nichingcarriesamajorriskinthatthemarketnichemightdryuporbeattacked.Thecompanyisthenstuckwithhighlyspecializedresourcesthatmaynothavehigh-valuealternativeuses.63WhyisNichingsoProfitable?Thefirmshould“sticktoitsniching”butnotnecessarilytoitsniche.

Thatiswhymultiplenichingispreferabletosingleniching.Bydevelopingstrengthintwoormoreniches,thecompanyincreasesitschancesforsurvival.Firmsenteringamarketshouldaimatanicheinitiallyratherthanthewholemarket.64MarketingMemo:NicheSpecialistRoles65

ProductLife-CycleMarketingStrategiesAcompany’spositioninganddifferentiationstrategymustchangeastheproduct,market,andcompetitorschangeovertheproductlifecycle(PLC).Productshavealimitedlife.Productsalespassthroughdistinctstages,eachposingdifferentchallenges,opportunities,andproblemstotheseller.ProfitsriseandfallatdifferentstagesofthePLC.Productsrequiredifferentmarketing,financial,manufacturing,purchasing,andhumanresourcestrategiesineachlife-cyclestage.66ProductLifeCycles(PLC)MostPLCcurvesareportrayedasbell-shaped(seeFigure11.4).Thiscurveistypicallydividedintofourstages:introduction,growth,maturity,anddecline.Introduction—Aperiodofslowsalesgrowthastheproductisintroducedinthemarket.Profitsarenonexistentbecauseoftheheavyexpensesofproductintroduction.Growth—Aperiodofrapidmarketacceptanceandsubstantialprofitimprovement.Maturity—Aslowdowninsalesgrowthbecausetheproducthasachievedacceptancebymostpotentialbuyers.Profitsstabilizeordeclinebecauseofincreasedcompetition.Decline—Salesshowadownwarddriftandprofitserode.67Figure11.4:SalesandProfitLifeCycles68ProductLifeCycles(PLC)ThePLCconceptcanbeusedtoanalyzeaproductcategory(television),aproductform(flatscreen),aproduct(LED),orabrand(LG).Notallproductsexhibitabell-shapedPLC.ThreecommonalternatepatternsareshowninFigure11.5.69Figure11.5:CommonProductLife-CyclePatterns70Growth-Slump-MaturityPatternFigure11.5(a)showsagrowth-slump-maturity

pattern,oftencharacteristicofsmallkitchenappliancessuchashand-heldmixersandbreadmakers.Salesgrowrapidlywhentheproductisfirstintroducedandthenfalltoa“petrified”levelthatissustainedbylateadoptersbuyingtheproductforthefirsttimeandearlyadoptersreplacingtheproduct.71Cycle-RecyclePatternThecycle-recyclepattern

inFigure11.5(b)oftendescribesthesalesofnewdrugs.Thepharmaceuticalcompanyaggressivelypromotesitsnewdrug,andthisproducesthefirstcycle.Later,salesstartdecliningandthecompanygivesthedruganotherpromotionpush