Compare and Contrast the Characteristics of a Growing and a Mature Product Market Essay Example for Free

Compare and Contrast the Characteristics of a Growing and a Mature Product Market Essay ‘Use extended examples to compare and contrast the characteristics of a growing and a mature product market. Regardless of the value of every product, they all progress through a product life cycle. The phase starts with the introduction of the product and gradually moves to growth, maturity and finally be replaced by new improved products or naturally decline. Each of these stages of product life cycle requires a different marketing mix and research. The life of a product is the period over which it appeals to customers. The sales performance of any product rises from nothing when the product is introduced to the market reaches a peak and then declines to nothing again. Examples of products that have had short lifespan in recent years are home computers. New models with new specifications are launched on the market rapidly to be replaced by newer models which is a similar story for mobile phones (ref: the times hundred business studies; Marketing Theory; online) Increase in the profit of the company is every businesses core goal. To reach the goal product life cycle management is vital. Some companies use strategic planning and others follow the basic rules of the different life cycle phase that are analysed later. The performance of the product has the main effect on the performance of every business from income to profit to cost recovery. Product life cycle helps business management decide which of its current products should receive more or less investment to ensure the business achieves its objectives. Let’s take an example of Apple iPhone: Introduction: Apple first introduces iPhone in Macworld San Francisco—January 9, 2007 (ref: Apple Press info; online). Growth: The apple iPhone sales for the year 2008 with 245% sales increase (ref: CNNMoney; iPhone sales grew 245% in 2008; online). Maturity: They introduced iPhone in other networks like 3G, 3Gs and Vodafone. Decline: iPhone 3G sold in cheaper price. Now they have moved from iPhone 3G to IPhone 4 and the latest iPhone 4 Siri. Apple first introduced iPhone in Macworld San Francisco—January 9, 2007. After its release iPhone made very good marketing sales in the stores. Many people lined up in front of the apple store to buy the newly released iPhone. Soon after its release apple had the sales of 6. 89 million (ref: CNNMoney; iPhone sales grew 245% in 2008; online). Apple used various promotional strategies to increase their market share. Their TV ads introduced people what their key features where and how they could be used. The first UK network to sell iPhone was O2 (ref; BBC news; O2 get iPhone contract in UK; online). After the partnership between the two business companies, O2 provided different monthly plan and tariffs for iPhone. More people where interested in buying iPhone in monthly plan and tariffs with O2. Apple also provided their customers with 1 Year free warranty for iPhone by which they managed to win trust and satisfaction from the customers. Because the iPhone was only supported by a single network 02, the company started to face decline in sale prices. They were at the maturity stage so; the iPhone brought different plan and ideas to boost up their sales again. In order to do so apple reduced price of iPhone. They made partnership with other networks like Vodafone (ref; BBC news; Vodafone enters UK iPhone market; online). Positive progress where then seen after they planned to join other networks and reduce the product price. In the time between 2009 and 2010 apple were able to sell 20, 731,000 iPhone. But they are rapidly doing there product development and now they have recently released iPhone 4s on 14th October 2011 (ref: techradar. com; apple iPhone 4S UK release date announced; online). Through the above different phases Apple has been able to establish itself a third position in the smartphone market share. This shows how different product phases can affect a company. As you can see iPhone had the popularity on the introduction and increased sales on the growing phase but it started to have fewer sales and went into maturity. At the maturity phase apple had to invest more on their product development and increase their sales and popularity. They had less income but more expenses as they had to implement development plans and strategies and increase advertisement. During the phases apple may not have been able to make profit but they gradually came up with new ideas and increased income. Summing up the product life cycle has a significant impact on the business strategy and performance including marketing and product development. It also helps the business determine when it’s reasonable to eliminate certain product, what are the consequences and also work on substituting it with new innovative product. But with the benefits there are also some limitations of product life cycle. As Products, companies and markets are different, so not all products or services go through every stage of the PLC. There have been many cases where products have gone straight from introduction to decline, usually because of bad marketing, misconceived features, lack of value to the consumer or simply a lack of need for such a product. However, even if products would go through every stage of the PLC, not all products/services spend the same length of time at each stage. This adds another level of complexity in determining which PLC stage the product is in and consequently, which strategy to apply (ref: marketing91. com; limitation PLC; online). Hence, there are both benefits and limitations of product life cycle and it has different effect on a company depending on which stage the product is and what strategy is to be implemented. The Product Life Cycle model is inefficient when dealing with Brands or Services. Brands are not products but do have a life cycle of their own, and products belonging to a certain brand will experience a very different life cycle than the brand itself. For example, Dell and Mercedes-Benz are very strong brands whose life cycle is marginally affected by the failure of any of the products, which they hold (ref: marketing91. com; limitation PLC; online).