LifebuoyProduct life cycle &

Marketing Strategies

By: Akash Trivedi Ankit Jain

Ankit Chandak Paul Dinakar

Vamsi Krishna Ankur Jain

Introduction

One of the oldest brand of HUL & positioned as health & hygiene soap.

Introduced in 1895 as a disinfectant soap especially when the country was severely affected by diseases like typhoid plague & yellow fever

Lifebuoy was the only soap brand to cross 100,000 tonnes of sales in a single year

The Brick Red Soap with its beautiful jingle have carried the message of health across the length and breadth of the country making it the largest selling soap brand in the world

Marketing mix

Product• Launched as carbolic red

disinfectant soap

• Initially meant only for health & hygiene

• Moved on to freshness , beauty care, nature care & deodorant

• Rejuvenated product cycle by increasing line /length

Price• Targeted lower & middle

income group mainly the rural consumers

• Priced at comparatively low price to attract more customers

• Moved on to high prices following the process of trading-up

Place• With strong distribution

channel mainly targeted rural market.

Promotion• Initially positioned as a

male brand then moved on to family brand

• Used health programs for promotion to make people aware about health & hygiene

Why a product life cycle?A company’s positioning and differentiation strategy must change

as the product, market, and competitors change over the time.

When we say that a product has a life cycle we assert four things:

i. Products have a limited life.

ii. Products sales pass through different stages, each posing different challenges, opportunities and problems to the seller.

iii.Profits rise and fall at different stages of the product life cycle.

iv.Products require different marketing, financial, manufacturing, purchasing, and human resource strategies in each life – cycle stages.

Product Life Cycle

Product life cycle is the stages over which a product develops & affects the sales and profits over time.

The five stages of each product lifecycle are:

Product development

Introduction

Growth,

Maturity

Decline.

Different patterns of PLC

Sales and Profits Over the Product’s Lifetime

Product Life Cycle

Monopoly Monopolistic Oligopoly Pure Competition

SalesSales

CostsCosts

ProfitsProfits

Marketing ObjectivesMarketing Objectives

ProductProduct

LowLow

High cost per customerHigh cost per customer

NegativeNegative

Create product awareness and trialCreate product awareness and trial

Offer a basic productOffer a basic product

DistributionDistribution Build selective distributionBuild selective distribution

PromotionPromotion Heavy to entice product trialHeavy to entice product trial

Summary of Characteristics, Objectives, & Strategies

Introduction Stage of the PLC

SalesSales

CostsCosts

ProfitsProfits

Marketing ObjectivesMarketing Objectives

ProductProduct

PricePrice

Rapidly risingRapidly rising

Average cost per customerAverage cost per customer

RisingRising

Maximize market shareMaximize market share

Offer extension, service, warrantyOffer extension, service, warranty

Penetration strategyPenetration strategy

DistributionDistribution Build intensive distributionBuild intensive distribution

PromotionPromotion Reduce to take advantage of demandReduce to take advantage of demand

Summary of Characteristics, Objectives, & Strategies

Growth Stage of the PLC

SalesSales

CostsCosts

ProfitsProfits

Marketing ObjectivesMarketing Objectives

ProductProduct

PricePrice

PeakPeak

Low cost per customerLow cost per customer

HighHigh

Maximize profits while defending market shareMaximize profits while defending market share

Diversify brand and models Diversify brand and models

Match or best competitorsMatch or best competitors

DistributionDistribution Build more intensive distributionBuild more intensive distribution

PromotionPromotion Increase to encourage brand switchingIncrease to encourage brand switching

Summary of Characteristics, Objectives, & Strategies

Maturity Stage of the PLC

SalesSales

CostsCosts

ProfitsProfits

Marketing ObjectivesMarketing Objectives

ProductProduct

PricePrice

DecliningDeclining

Low cost per customerLow cost per customer

DecliningDeclining

Reduce expenditures and milk the brandReduce expenditures and milk the brand

Phase out weak itemsPhase out weak items

Cut priceCut price

DistributionDistribution Selective: phase out unprofitable outletsSelective: phase out unprofitable outlets

PromotionPromotion Reduce to minimum levelReduce to minimum level

Summary of Characteristics, Objectives, & Strategies

Decline Stage of the PLC

Three special categories of PLC

Continued…

A Style is a basic and distinctive mode of expression appearing in a field of human endeavor. Styles appear in homes, clothing, art etc.

A Fashion is a currently accepted or popular style in a given field. Fashion pass through four stages: Distinctiveness, emulation, mass fashion, decline.

Fads are fashions that comes quickly into public view , are adopted with great zeal, peak early, and decline very fast.

Four IntroductoryMarketing Strategies

Rapid-Rapid-skimmingskimmingStrategyStrategy

Rapid-Rapid-skimmingskimmingStrategyStrategy

Rapid-Rapid-penetrationpenetrationstrategystrategy

Rapid-Rapid-penetrationpenetrationstrategystrategy

Slow-Slow-penetrationpenetrationstrategystrategy

Slow-Slow-penetrationpenetrationstrategystrategy

Slow-Slow-skimmingskimmingstrategystrategy

Slow-Slow-skimmingskimmingstrategystrategy

PricePrice

LowLow

HighHigh

PromotionPromotionHighHigh LowLow

Marketing strategies for Growth stage

During the growth stage, the firm uses several strategies to sustain rapid market growth.

Improves product quality and adds new features and improved styling.

Adds new models and flanker products(i.e., products of different sizes, flavors, and so forth that protect the main product).

Enters new market segments Increases its distribution coverage and enters new

distribution channels. Shifts from product- awareness advertising to product-

preference advertising. Lowers price to attract the next layer of price – sensitive

buyers.

Marketing strategies for Maturity stage

Three useful ways to change the course for a brand are market, product, and marketing program modification.

Market Modification

Expand the no. of brand users

Convert nonusers into users

Enter new market segments

Attract competitors’ customers

Continued..

Increase the usage rate among users

Find out new ways to use the product

Find out on what occasions consumers by more products

Product modificationQuality improvement:

Aims at increasing the product’s functional performance.

Eg: Aashirvaad, Annapoorna, Pillsbury, Naturefresh

Feature improvement

Aims at adding new features, such as size, weight, materials, additives, and accessories, that expand the product’s performance, versatility, safety, or convenience.

Style improvement

Aims at increasing the product’s esthetics appeal.

Eg; New car models, New Coke

Marketing modification

Prices: Price cut by means of discounts,special prices etc.

Distribution: Adding more distribution channels to increase the penetration?

Sales Promotion: Rebates,warranties,gurantees,gifts & contests,rebates,price-off coupons.

Services: Providing more assistance to customers.

Decline Stage

• Drop unprofitable customers

• Cost cutting measures

• Line pruning

• Harvesting

• Divesting

Limitations of PLC

• Like human beings products does not have a very predictable life so the concept of product life cycle is not well suited for forecasting of product sales.

• It yields a product oriented picture rather than a market oriented picture.

• Product life cycle may become self fulfilling ,means if sales peak & then decline managers may misinterpret it as decline phase & therefore cut the advertising budget and thus making a further decline.