MCS 1000 Chapter Notes - Chapter 11: Gatorade, Dewalt, Umbrella Brand

• School: University of Guelph
• Department: Marketing and Consumer Studies
• Course: MCS 1000
• Professor: Douglas Adlam

Document Summary

Product life cycle: describes the stages a new product goes through in the marketplace (4 stages): o. Sales grow slowly, profit is minimal (because of large up front costs). Objective is to create awareness and stimulate trial (the initial purchase by the consumer). Stimulate primary demand (desire for product class) via advertising and promotion. As competition increases, create selective demand (specific brand target) Gain distribution (retailers hesitant to carry a new product). Rapid increase in sales (via new customers and repeat customers) Slowing of total industry sales or product class revenue. Sales increase at a decreasing rate; profit declines as price competition ensues: decline stage: Frequently not due to poor strategy; usually caused by environmental changes. One of two strategies for a declining product - deletion or harvesting. Harvesting: retain the product but reduce marketing/sales to minimum. Four aspects of product life cycle: o. Consumer products tend to have shorter length than business products.