Group 9

P15018 Sameer, P16024 Sunil, P16002 Himanshu, P16015 Amit, P16052 Dhruv
Product Life-Cycle Marketing Strategies Summary
Each product has a life cycle which can be asserted by following four things:
1. Each Product have a limited life.
2. Each product passes through various stages having challenges, opportunities and problems of
their own.
3. Profit varies with different stages of product life cycle.
4. Product requires different marketing, financial, manufacturing, resource planning strategies
at different stages.
Most of the product display bell-shaped curves, which can be divided into four stages.
1. Introduction: This is the introduction of product in market so the sales are slow, expenses are
higher and profits are non-existent in this stage.
2. Growth: In this stage product is rapidly accepted by early adopters and profits improves
substantially.
3. Maturity: In this stage product has achieved the maximum market penetration and growth in
sales are in slowdown. Profits are constant or declining due to increasing competition.
4. Decline: In this stage, sales are on downward side and profits keep on eroding.
There are three alternate pattern also apart from these 4 product life cycle stages.
1. Growth-Slump-Maturity Pattern: In this sales rises rapidly at the time of introduction and
then falls to a petrified level sustained by late adopters or repeat buying.
2. Cycle-Recycle Pattern: In this company first aggressively promotes the product which produce
first cycle and once the sales start declining then second promotion is done to produce second
cycle.
3. Scalloped Pattern: In this sales passes through succession of life cycles based on the discovery
of new product characteristics, uses, and users.
There are three special categories of product life cycle. Style is a basic and distinctive mode of
expression appearing in a field of human endeavour. Fashion is a currently accepted or popular style
in a given field. A fad is a fashion that come quickly in public view, accepted with great zeal, peak early
and decline very fast. Company need to define their marketing strategies as per the product life
product is in. Each stage poses different challenges, opportunities, and problems which can be
countered with properly defined marketing strategies for each stage.
Marketing Strategies for introduction stage and the pioneer advantage
Introduction of a new product takes time so company need to work out the technical problems, should
decide on the distribution channels, and should try to gain the consumer acceptance. Sales growth
tends to be slow in this stage. Company have to borne the losses and promotional expenditure are
highest ratio to sales because company need to inform potential customers, introduce the product
trials and secure distribution in retail outlets. As the prices are high in this stage, company focuses on
the customers who are most ready to buy the product. Company need to decide when they should
launch the product. First movers can be rewarding but risky and expensive also. To come late also
makes sense if company can improve the product quality, have a better technology. Studies have
shown that market pioneer can gain great advantage. As they will have the large market share they
can overcome double jeopardy issues due to customer loyalty. Customer can easily recall the first
launched branch name. There are also production advantages like economies of scale, patents,
ownership of scarce assets and ability to erect entry barrier to competitors. There are disadvantages
of being pioneers also. High innovation costs, company may improperly position the product which
competitors can take advantage of. For gaining pioneering advantages, company need to take care of

Group 9
P15018 Sameer, P16024 Sunil, P16002 Himanshu, P16015 Amit, P16052 Dhruv
five forces: vision of a mass market, persistence, relentless innovation, financial commitments and
asset leverage.
Marketing strategies for Growth Stage:
In growth stage, sales rapidly increase as early adopter like the product and new consumers start
buying it. Seeing the opportunity, competition starts increasing and they start launching new product
features due to which prices stabilizes or fall slightly. Companies need to maintain their marketing
expenditure or increase it depending upon the competition level and continue to educate the market.
Sales rises at a much faster rate than marketing expenditure, profits increased rapidly as marketing
expenses are spread over a larger volume now. Due to producer-learning effect, production cost also
declines more compares to the price giving more returns. Firms should watch out for change to a
deaccelerating rate of growth to prepare future strategies. To sustain the rapid market share growth
company should improve product quality and add new feature, add new models/flanker products,
enters in new market segments, increase distribution coverage, shift to loyalty programmes and low
prices to attract price-sensitive consumers.
Marketing strategies for Maturity Stage:
Maturity stages divides into three phases: growth, stable and decaying maturity. In first sales growth
slows down. In second phase sales per capital flattens due to market saturation. Third phase is critical
and poses most challenges. Due to overcapacity, prices falls sharply, profits trims significantly and
weak competitors have to withdraw. Market leaders due to high volumes and low cost can survive
this but other firms will have to shut down. Some companies drop their weak products to concentrate
on new and profitable products. A firm can change the course for a brand through market, product,
and marketing program modifications. In market modification, company focuses on non-users, can
enter new market segments, and try to increase the consumption in present market. In product
modification, company tries to improve the quality, adds new features and styles. In market program
modification, brand managers try to simulate sales by modifying non-product elements like price,
distribution and communication.
Marketing strategies for Decline Stage:
Finally the sales starts declining significantly which may be due to technological advances, shifts in
consumer tastes, and increase in competition. As the sales and profits declines, some firms withdraw.
Other reduces the number of product offerings, exit smaller segments and weaker trade channels and
reducing prices further. Elimination of weak products is the strategy most companies applies in this
stage. Besides being unprofitable, weak products consumers lot of managements time, requires
frequent price and inventory adjustments, incur expensive setup for short production runs, and cast
a negative shadow on company image. There is no standard approach to identify these products. This
can be done by arranging product review meetings with all disciplines and then make
recommendations for each products future plans.
Another strategy is to harvesting and divesting the products. Harvesting is gradual reduction in
product cost or businesss cost while trying to maintain the sales. First company cuts the R&D costs
and plant and equipment investments, then reduces the product quality, sales force size, marginal
services and advertising expenditures without letting anyone know about all these changes. In
divesting, company decides to sell the product to another firm. If the company cant find any buyers,
then they must decide whether to liquidate the brand quickly or slowly.
While PLC concept is focused on product, same can be extended to a market oriented picture also.
Like products, market also evolve through four stages: emergence, growth, maturity and decline.

Group 9
P15018 Sameer, P16024 Sunil, P16002 Himanshu, P16015 Amit, P16052 Dhruv
Case analysis: The Brita Products Company
Background (4 C analysis)
Consumer & Context:
According to the USA TODAY, CNN and Gallup Poll, due to increase in the contamination of the ground
water 47% of respondents are not ready drink direct tap water. By 1997 Bottled water made up 8% of
all the liquids that people paid to drink and was the industrys fastest growing category. According to
survey conducted in 1999 72% of all respondents and 89% of young adults voiced some concern about
the quality of their household water supply. People who are taking no precautions about their
exposure to public water supplies from 47% to 35% in 4 years.
Company:
Brita GmbH a German based family owned corporation had been struggling without much success to
sell its home water filtration system in the US till 1988 until Charlie Couric, after vigorous negotiations,
convinced Brita GmbH to let Clorox form a subsidiary, Brita USA to be the sole distributor of Brita
products.
After Initial struggle of 4 years sales started to increase steadily and by 1999 Brita had a 70% revenue
share of $350 million worth of home water purification industry.
Competitor:
Brita was enjoying 80% market share which attracted many competitors like Culligan, Electrolux,
Sunbeam, PUR, Rubbermaid etc. But none of them succeeded in challenging Britas leadership. In 1999
PURs market share became double digit which was publicly held US Corporation, Recovery
Engineering. PUR announced that it would spend $40 million in ad and promotion to support its
faucet-mount and pitcher filters. Sunbeam would back the product with an estimate of $10million of
advertisement. Teledyne also unveiled its faucet-mount product.
Rubbermaid had launched low priced product in 1997 which used the technology similar to Britas.
But its sales were disappointing owing to lack of advertising.
Decision problem statement:
Should Clorox launch the Faucet-mounted purifier? If yes, should they continue to use Britas name
for this product and would it cannibalize pitcher and pitcher filter sales?
Alternatives:
1. Launch faucet-mounted Product with Britas name and continue the Brita Pitcher and filter
sales.
2. Launch faucet-mounted Product without Britas name and continue the Brita Pitcher and filter
sales.
3. Do not launch faucet-mounted Product and concentrate on marketing of the Brita Pitcher and
filter sales.
Evaluation of alternatives:
If we choose the first alternative the product can enjoy the Brita brand value, but 3-4% of sales must
be paid to parent company as a royalty and would also be bound by the non-compete clause of
comprehensive agreement that limits the sales or products with Brita name to North America. With
this there is also a chance of cannibalization of Pitcher sales by faucet-mount product or vice-versa.

Group 9
P15018 Sameer, P16024 Sunil, P16002 Himanshu, P16015 Amit, P16052 Dhruv
If we choose the second alternative the product loses its Brita brand value, which is preferred by the
retailers and also additional marketing would be required. But on the other hand it would save the
royalty that it had to give to Brita for using its name.
If we choose the third alternative Brita pitcher sales will not increase considerably because it has
already reached its maturity stage of its life cycle as indicated in the case. Also clorox will forego the
opportunity to earn a market share in the faucet-mounted product industry.
Recommended action:
Launch faucet-mounted Product with Britas name and continue the Brita Pitcher and filter sales.
Reasons:
1. Brita name increased the likelihood of buying a faucet mounted product.
2. Though it is high priced Brita faucet filter generated similar levels of purchase intention to the
Brita pitcher.
3. Faucet filter water costs significantly less per glass because the filter lasted longer.
4. Irrespective of the price, unit sales and perceptions of value for the faucet-mount were strong.
Sales would not be significantly impacted even if PUR price was dropped by $5.
Negative implication of recommended action:
Cannibalization of pitcher sales to some extent by faucet-mount sales.
How to correct negative implication:
Clorox needs to position faucet mounted product which filters on a deeper level removing
cryptosporidium and giardia microbes owing to its finer filters.