MARKETING MANAGEMENT

GYAN GANGA GROUP OF INSTITUTIONS

MARKETING MANAGEMENT
UNIT – III

Marketing mix
The “4 Ps of Marketing” refer to the four key elements comprising the
process of marketing a product or service. They involve the marketing
mix, which is a set of tools that a company uses to influence
consumers into buying its product. The marketing mix addresses
factors such as:
• Understanding the needs or desires of consumers
• Identifying the cause of the failure of the current product
offering
• Finding ways to solve said problems and change public
perception of the product/service
• Creating distinguishing characteristics to increase competitive
advantage
• Understanding how the product interacts with consumers and
vice versa
• "The marketing mix, a fundamental concept in marketing
management, provides a structured approach for businesses to
effectively market their products. However, in today's dynamic
and customer-centric landscape, it's important to complement it
with other frameworks and strategies to stay relevant and
competitive."

NEHA SHRIVASTAVA 1
MARKETING MANAGEMENT

1. Product
A product is any good or service that fulfills consumer needs or
desires. It can also be defined as a bundle of utilities that comes with
physical aspects such as design, volume, brand name, etc. The type of
product impacts its perceived value, which allows companies to price
it profitably. It also affects other aspects such as product placement
and advertisements.
Companies can change the packaging, after-sales service, warranties,
and price range, or expand to new markets to meet their objectives.
Marketers must understand the product life cycle and come up with
strategies for every stage in the life cycle, i.e., introduction, growth,
maturity, and decline.
2. Price
The price of a product directly influences sales volume and,
consequently, business profits. Demand, cost, pricing trends among
competitors, and government regulations are crucial factors that
determine pricing. Price usually reflects the product’s perceived value
rather than its real value. This means that pricing can be increased to
promote exclusivity or reduced to create access.
Thus, pricing involves making decisions in terms of the basic price,
discounts, price alteration, credit terms, freight payments, etc. It is

NEHA SHRIVASTAVA 2
MARKETING MANAGEMENT

also important to analyze when and if techniques like discounting are

required or appropriate.
3. Promotion
Promotion involves decisions related to advertising, salesforce, direct
marketing, public relations, advertising budgets, etc. The primary aim
of promotion is to spread awareness about the product and
services offered by a company. It helps in persuading consumers to
choose a particular product over others in the market. Promotional
efforts include the following:
• Advertising: A means of selling a product, service, or idea
through communicating a sponsored, non-personal message
about the product.
• Public relations: Involves management and control of the flow
and matter of information from one’s organization to the general
public or other institutions.
• Marketing strategy: Involves identifying the right target
market and using tools such as advertising to penetrate the said
market. Promotion also includes online factors such as
determining the class of search functions on Google that may
trigger corresponding or targeted ads for the product, the design
and layout of a company’s webpage, or the content posted on
social media handles such as Twitter and Instagram.
4. Place (or Distribution)
Place involves choosing the place where products are to be made
available for sale. The primary motive of managing trade channels is
to ensure that the product is readily available to the customer at the
right time and place. It also involves decisions regarding the placing
and pricing of wholesale and retail outlets.
Distribution channels such as outsourcing or company transport fleets
are decided upon after cost-benefit analysis. Small details such as

NEHA SHRIVASTAVA 3
MARKETING MANAGEMENT

shelf space committed to the product by department stores are also

included.
Service Mix (7Ps)
In case of a service brand like a restaurant, telecom service,
hospitality etc., there are additional points apart from the 4Ps. The
additional Ps i.e. physical evidence, people and processes are
collectively known as the service marketing mix. These can be
described as below:
5) Physical Evidence
A service is intangible but there has to be a reassurance to the
customer that service happened. It can be a receipt of a service or may
be an invoice. Physical evidence should be positive meaning that
customer should be assured that service completed as expected.
6) People
These are the employees which help deliver the service e.g. delivery
boy or a cab driver. They may become the face of the service hence
are very important that is why very important to chose right people.
7) Process
The steps undertaken for completion/delivery of the service. The
process is very crucial. The process should not only consist of the
positive path but should also should consider the negative paths to
address issues in the service delivery. e.g. Complain management,
reverse supply chain etc.
Advantages of the Marketing Mix
The marketing mix framework offers several advantages for
businesses and marketers:
1. Comprehensive Marketing Strategy: The marketing mix
provides a structured framework that ensures all essential
elements of marketing are considered and integrated into a
cohesive strategy. It helps businesses to systematically analyze

NEHA SHRIVASTAVA 4
MARKETING MANAGEMENT

and optimize key marketing decisions related to product, price,

place, and promotion, leading to a well-rounded and
comprehensive marketing approach.
2. Flexibility and Adaptability: The marketing mix framework is
flexible and can be adjusted to suit different industries, markets,
and business situations. It allows marketers to adapt their
marketing strategy based on changing customer needs,
competitive dynamics, and market conditions, providing the
agility needed to respond to evolving market trends and
consumer preferences.
3. Customer-focused Approach: The marketing mix emphasizes
the importance of understanding and meeting customer needs.
By considering factors such as product features, pricing,
distribution channels, and promotional tactics from the
perspective of the target audience, businesses can better align
their marketing efforts with customer preferences, leading to
improved customer satisfaction and loyalty.
4. Holistic Marketing Planning: The marketing mix encourages a
holistic approach to marketing planning, ensuring that all
marketing elements are aligned and work together cohesively. This
helps businesses to avoid fragmented or inconsistent marketing
efforts and ensures that all aspects of marketing are coordinated to
achieve business objectives effectively.
5. Improved Decision-making: The marketing mix provides a
structured framework for decision-making, enabling businesses
to make informed and strategic choices regarding product
development, pricing strategies, distribution channels, and
promotional tactics. It helps businesses to evaluate various
options, weigh the pros and cons, and make data-driven
decisions, leading to more effective and efficient marketing
strategies.

NEHA SHRIVASTAVA 5
MARKETING MANAGEMENT

6. Competitive Advantage: Properly implementing the marketing

mix can provide a competitive advantage by helping businesses
differentiate themselves from competitors, create unique value
propositions, and align their marketing efforts with target market
needs. This can lead to increased brand awareness, customer loyalty,
and market share, ultimately resulting in improved business
performance.
Disadvantages of the Marketing Mix
1. Simplified Approach: The marketing mix framework provides
a simplified and structured approach to marketing, which may
not fully capture the complexity and nuances of modern
marketing. In today's dynamic business environment, marketing
decisions are often influenced by various internal and external
factors that may not be adequately addressed by the traditional
4Ps framework.
2. Limited Focus: The marketing mix primarily focuses on the
four key elements of product, price, place, and promotion, and
may not fully address other important aspects of modern
marketing, such as customer experience, digital marketing,
social media, and content marketing. This narrow focus may
limit the scope and effectiveness of marketing strategies in
today's rapidly evolving marketing landscape.
3. Lack of Customer-centricity: While the marketing mix
emphasises the importance of meeting customer needs, it may
not fully capture the growing importance of customer-centric
marketing. Modern marketing is increasingly focused on
building customer relationships, understanding customer
preferences, and delivering personalised experiences. The
marketing mix framework may not fully address these customer-
centric aspects of marketing.
4. Static Nature: The marketing mix framework can be
relatively static, as it may not adequately capture the dynamic
nature of modern marketing, which requires constant adaptation
NEHA SHRIVASTAVA 6
MARKETING MANAGEMENT

and agility. Market conditions, customer preferences, and

competitive dynamics can change rapidly, and businesses need
to be able to respond quickly and effectively. The marketing mix
may not provide the necessary flexibility and agility to keep up
with these changes.
5. Lack of Integration: The marketing mix elements of product,
price, place, and promotion are often treated as separate entities,
which may result in fragmented marketing efforts. In today's
integrated marketing landscape, where various marketing
channels and tactics need to work together cohesively, the
marketing mix framework may not fully promote integrated
marketing planning and execution.
6. Overemphasis on Traditional Marketing: The marketing
mix framework was originally developed for traditional
marketing channels, and may not fully capture the complexities
and nuances of modern digital marketing, social media
marketing, and other emerging marketing channels. Businesses
that heavily rely on digital and online marketing may find the
marketing mix framework less relevant or comprehensive.

Product
What is a Product?
◦ A product can be defined as a collection of physical, service and
symbolic attributes which yield satisfaction or benefits to a user
or buyer.
◦ According to W. Alderson, “A Product is a set of tangible and
intangible attributes, including packaging, colour, price,
manufacturer’s and retailer’s services, which the buyer may
accept as offering the satisfaction of wants or needs.”
◦ According to Philip Kotler, “a product can be offered to a
market for attention, acquisition and consumption that might

NEHA SHRIVASTAVA 7
MARKETING MANAGEMENT

satisfy a need or want. It includes physical objects, services,

persons, places, organisations and ideas.
Characteristics of Product
◦ A product is a set of Tangible and intangible attributes
◦ Product includes colour, price, packaging and branding
◦ Product is a group of utilities
◦ The product is designed and presented to satisfy some specific
consumer needs.
Classification of Products
◦ The concept of product not only relates to the physical product,
but also the benefits offered by the product. For example, while
purchasing a washing machine, a consumer does not only look
for its physical qualities but also some intangible factors such as
its brand name, guarantee offered, company’s image, status
symbol, etc. Hence, it can be said that a product is a mixture of
tangible and intangible features, a consumer can exchange for a
value in return to satisfy their needs. The three types of benefits
provided by a product to the customers are; namely,
Psychological benefits, Functional benefits, and Social
benefits. For instance, Sayeba purchased a wall painting from
an art gallery arranged by an NGO. After making the purchase
the functional benefits gained by her will be the decoration of
her living room. Similarly, she will get psychological benefits in
the form of satisfaction with her interest in art and creativity.
However, as she has purchased the painting from an NGO’s art
gallery, the money will be used as a donation which provides her
social benefits in the form of acceptance and a good image in
the eyes of people.

NEHA SHRIVASTAVA 8
MARKETING MANAGEMENT

Products can be classified into two categories; viz., Consumer

Products and Industrial Products.
Consumer Products
The products which directly satisfy the wants and needs of a
consumer are known as Consumer Products. For instance, soap,
clothes, bread, jam, butter, etc. Consumer products are used by
consumers for their personal needs. These products can be further
classified into two categories: On the Basis of Durability and On the
Basis of Shopping Efforts.
A. On the Basis of Durability
Based on Durability there are three types of consumer products;
namely, Non-Durable Products, Durable Products, and Services.
i) Durable Products
The goods that can be used for a long period of time are known
as Durable Products. For example, sewing machines, washing
machines, refrigerators, air conditioners, etc. The durable goods
include higher profit margins for the producer and needs greater
personal selling efforts and various after-sales service by the
organisation.
ii) Non-durable Products
The goods that can be consumed for a short period of time (one or
few uses only) are known as Non-durable Products. For
example, soap, shampoo, toothpaste, biscuits, etc. These products
need heavy advertising and have less profit margin.
iii) Services
The activities, satisfaction, or benefits offered by an organisation for
sale are known as Services. For example, services offered by a CA,
teacher, doctor, etc. Services are intangible in nature, which means
that we cannot see, touch, or feel them. They are also inseparable
from their source and cannot be stored because of their perishability.
Another feature of services is that they are highly variable because the
NEHA SHRIVASTAVA 9
MARKETING MANAGEMENT

quality and experience gained by a consumer vary with the person

providing them.
B. On the Basis of Shopping Efforts
Based on Shopping Efforts there are three types of products;
namely, Convenience Products, Shopping Products, and Speciality
Products.
i) Convenience Products
The products which are purchased immediately, frequently, and with
the least effort and time are known as Convenience
Products. Convenience goods require minimum shopping effort. For
example, newspapers, salt, matchbox, medicines, etc.
Some of the features of Convenience Products are as follows:
• Convenience goods are purchased in small numbers.
• Generally, they are of low price.
• These products are usually purchased at convenient locations
with the least time and effort.
• The price of convenient products is standardized, as they are
branded products.
• As these are essential products, they have regular and
continuous demand.
• Different sales promotion schemes, such as discounts, contests,
cashback, etc., also help in the marketing of convenience
products.
• However, convenience products face stiff competition;
therefore, need heavy advertisement.
ii) Shopping Products
The products in which consumers devote considerable effort and time
in shopping are known as Shopping Products. For these products, the

1
NEHA SHRIVASTAVA
0
MARKETING MANAGEMENT

buyer first compares the price, style, quality, etc., of different brands
at different stores before making the final decision of purchase. For
example, shoes, clothes, mobile phones, jewelry, etc.
Some of the features of Shopping Products are as follows:
• Shopping products are usually durable.
• The unit price as well the profit margin of the shopping products
are high.
• Consumers usually plan in advance to purchase these products.
• Before making the final decision of the purchase, the consumers
first compare products of different companies and at different
stores.
• The retailers help the manufacturer in the sale of shopping
products, as they play a crucial role in persuading the consumers
in buying the product.
iii) Specialty Products
The products with some special features for which the consumers
make special efforts, while purchasing them are known as Specialty
Products. Demand for specialty products is relatively inelastic. It
means that even though the price of specialty products rises, their
demand does not reduce. For example, antique paintings, exotic
perfumes, expensive watches, branded sneakers, etc.
Some of the features of Specialty Products are as follows:
• Specialty products are usually expensive and are available at a
few selected places.
• Because of their high cost, only a few people purchase these
products which make their demand limited.
• An organisation need to perform aggressive promotion activities
for these products.

1
NEHA SHRIVASTAVA
1
 MARKETING MANAGEMENT

• The job of the marketer of specialty products does not end with
the sales. They have to provide after-sales services to the
consumers also.

Convenience Shopping
Basis Speciality Products
Products Products

The products which

The products with
are purchased The products in
some special
immediately, which consumers
features for which
frequently, and with devote considerable
the consumers make
Meaning the least effort and effort and time in
special efforts while
purchasing time are shopping are
purchasing them are
known as known as Shopping
known as Speciality
Convenience Products.
Products.
Products.

The price of The price of The price of

Price convenience products shopping products speciality products is
is low. is high. very high.

Least time and effort Considerable time

Special efforts are
are required in and effort are
Shopping required in
purchasing required in
Efforts purchasing
convenience purchasing
speciality products.
products. shopping products.

1
NEHA SHRIVASTAVA
2
 MARKETING MANAGEMENT

These products are These products are These products are

Availability available at available at available at a few
convenient locations. specified shops. places.

As these products are As these products As these products

Nature of essential products, are usually durable, are bought by a few
Demand they have regular they have no people, they have
demand. regular demand. limited demand.

There is a low
There is a high There is a very high
Profit margin in
margin in shopping margin in speciality
Margin convenience
products. products.
products.

These products
These products
require heavy These products
Role of require aggressive
advertisement and require personal
Promotion promotional
sales promotion selling.
activities.
schemes.

After-sales services
After-sales service After-sales services
After-sales are not required for
is required in some are very crucial for
service convenience
cases. speciality products.
products.

Shoes, Expensive watches,

Salt, Medicines,
Examples Refrigerator, Antique Paintings,
Newspapers, etc.
Clothes, etc. etc.

1
NEHA SHRIVASTAVA
3
MARKETING MANAGEMENT

2. Industrial Products
The products used by the organisations as inputs for the production of
other products are known as Industrial Products. For
example, lubricants, tools, equipment, machines, etc.

Features of Industrial Products

1. Number of Buyers
The number of buyers of industrial products is limited as compared to
the buyers of consumer products. For example, buyers of wheat are
less as compared to flour.
2. Channels Level
The channel of distribution for industrial products is usually shorter,
as the number of buyers is limited for these products.
3. Geographic Concentration
As industries are usually located in specific regions, the demand for
industrial products is concentrated in one geographical location.
4. Derived Demand
The demand for industrial products is derived from the demand for
consumer products. For example, industries will have a demand for
fur, if people demand fur jackets or other products.
5. Reciprocal Purchasing
A common case of industrial product purchasers, in which one
organisation buys from another company, on one condition that the
latter will buy from the former is known as Reciprocal
Purchasing. For example, a shoe company purchases leather from a
leather company, only if it buys the manufactured shoes from the shoe
company.

1
NEHA SHRIVASTAVA
4
MARKETING MANAGEMENT

6. Role of Technical Considerations

Industrial Products are complex in nature; therefore, they require
higher technical considerations in their purchase.
7. Leasing Out
As the cost of industrial products is high, organisations usually lease
out these products instead of purchasing them. For example, a road
construction company may hire or lease out a road-roller instead of
purchasing it.
Classification of Industrial Products
Industrial Products can be classified into three categories;
namely, Materials and Parts, Capital Items, and Supplies and
Business Services.
i) Materials and Parts
The goods which enter the products of a manufacturer completely are
known as Materials and Parts. These goods are of two types;
namely, Raw Material and Manufactured Material and Parts.
• Raw Material: It consists of farm products such as sugarcane,
cotton, etc.
• Manufactured Material and Parts: It consists of component
materials such as iron, glass, etc., and other components parts,
such as batteries, tyres, etc.
ii) Capital Items
The fixed assets which are used by an organisation for the production
of finished goods are known as Capital Items. For example, fax
machines, laptops, etc.
iii) Supplies and Business Services

1
NEHA SHRIVASTAVA
5
MARKETING MANAGEMENT

The goods and services which are used by organisations to facilitate

the development and management of the finished products are known
as Supplies and Business Services. For example, maintenance items
such as paint, nails, etc., and operating supplies, such as writing paper,
lubricants, etc.
What are Product Decisions?
Marketing mix describes how businesses use and manipulate the 4Ps
to market their products. Businesses employ different strategies when
marketing products compared to services. As a physical product,
marketers need to make several decisions. These decisions are called
product decisions. These include decisions related to packaging,
labelling and branding involved in marketing the overall product.

1
NEHA SHRIVASTAVA
6
MARKETING MANAGEMENT

New Product Decision

 A new product incorporates the elements of newness and varies
from the existing ones. It may include new features,
qualities or be introduced differently. Besides, adding new
products can result in growth, profitability, increased market
share and more.
 To remain profitable and maintain sales, organizations need to
launch new products. However, the products may fail, so the
marketers must take new product decisions wisely.
1
NEHA SHRIVASTAVA
7
MARKETING MANAGEMENT

 The product decisions may include:

1. Original Product
2. Improved Product
3. Modified Product
4. Development of Product
5. Launching Products, etc.

Product Line Decisions

◦ Product line decisions refer to decisions relating to the addition
or deletion of product(s) from existing product lines. These
include decisions like
◦ Product line length decision: These decisions are related to the
length of the product line. This involves decisions like adding a
new product or eliminating and profitable product in the product
line.
◦ Product line stretching decision: This decision is related to
lengthening a firm’s product line beyond its current line by
adding new products.
◦ Product line modernisation decision: A strategy in which items
in a product line are modified to suit modern styling and tastes
and re-launched
◦ Product line featuring decision: these decisions include
highlighting specific products from the existing product line.
Producers feature promotional models at the low end of the line
to serve as “traffic builders.”... Read more at:
https://www.adda247.com/teaching-jobs-exam/product-
decisions/
Product Line: Definition and Importance

1
NEHA SHRIVASTAVA
8
MARKETING MANAGEMENT

◦ A product line refers to a group of related products offered by a

company under the same brand or product category. These
products share similarities in terms of target market, customer
needs, distribution channels, or pricing strategies. For example,
an athletic shoe company may have a product line that includes
running shoes, basketball shoes, and training shoes.
◦ Having a well-defined product line is essential for several
reasons:
1. Market Segmentation: A product line allows companies to cater to
different segments of the market with specific products that meet the
unique needs and preferences of each segment.
2. Brand Cohesion: A coherent product line helps build a strong
brand identity by maintaining consistency in product attributes,
quality, and customer experience across different offerings.
3. Customer Loyalty: Offering a range of products within a product
line helps build customer loyalty. Once customers are satisfied with
one product from the line, they are more likely to try and trust other
products within the same line.
4. Cost Efficiency: Developing and marketing products within a
product line can be more cost-effective than creating entirely new
products from scratch. Companies can leverage shared resources,
manufacturing processes, and marketing strategies to reduce costs and
improve profitability.
Characteristics of Product Line:
1. Product line consists of closely related product items. Difference is
only found in terms of colour, size, shape, model, performance,
weight, and capacity.
2. It is a compose of various similar items.
3. Product items are complementary to one another. For example,
tube, tyre, and related materials.

1
NEHA SHRIVASTAVA
9
MARKETING MANAGEMENT

4. There is difference in price. For example, Hero Honda charges

different price for different models.
5. The purpose of offering similar items in each of the product line
may be to attract customers by offering more varieties, and to create a
good image or reputation.
6. Different items of a product line can be manufactured using same
technology and/or inputs.
7. Product items in each of the product lines are distributed in same
distribution channel. That is, similar outlets market them.
8. Product items in each product line function in same manner. They
need same technical skills to use them.
9. They are sold to similar customer groups. They satisfy needs of the
same groups.
10. They have more or less same use or utility. They are used for the
same purpose.
Example
To understand a company's product line, we must first consider the
types of products it has. For example, Coca-Cola has three main
product types: sodas, Minute Maid, and mineral water. The soft drinks
line has five products - Coca-Cola, Diet Coke, Coke Zero, Fanta, and
Sprite. The Minute Maid product line has three products (Guava,
Mango, and Mixed Fruit), and mineral water has 1 product.1
In this example, the number of Coca-Cola product lines is 3.
Companies develop product lines to maximize the profit of popular
items. For example, Coca-Cola is a popular soft drink many people
worldwide enjoy. To leverage the success of the original Coke, the
company introduced several varieties to this product line, such as
Coke Zero, Diet Coke, Vanilla Coke, etc.
Types of Product Line

2
NEHA SHRIVASTAVA
0
MARKETING MANAGEMENT

Along with product line strategies, there are five types of product
lines that companies can add to their portfolio:
• New to the world - This is the brand new product line
introduced to the market after careful research & development.
New-to-world products come with many risks but are also very
rewarding. If successful, it can lead to multiple products and
varieties added to the original product line. For example, after
the success of the first iPhone in 2007, Apple released 33 more
iPhone models over the past 15 years. They have all been doing
well on the market, reaching over 1 billion people.
• New product lines - these are products added to production but
not exactly new to the world. The companies that develop these
products have already established a loyal customer base and
develop new products to compete with competitors in the
market. For example, Apple launched the Apple TV streaming
service in 2019 to compete with companies like Netflix or
Disney Plus.
• Product line extensions - These are new additions that fit into
the company's existing product line. For example, Coca-Cola
launches many varieties of Coke in addition to its classic Coke.

• Product improvements - These are updates that improve the

quality and value of existing products. An example of this is
mobile app updates. The improvements can be subtle such as
Colgate improving their toothpaste formula over time or
replacing the existing product completely.
• Repositioning - sometimes, companies can introduce a new
application for an existing product to reach a new market
segment. This is known as repositioning. For example, Nokia
used to focus on marketing cell phones (a B2C business model).
After the drastic failure against smartphones, the company has

2
NEHA SHRIVASTAVA
1
MARKETING MANAGEMENT

switched its focus on B2B service of data networking and

telecommunications.
Product Line Pricing
• Bundle pricing involves packaging several items as one and
selling them at a single price. For example, a hotel service
includes accommodation, pick-up at the airport, and free
breakfast.
• Leader pricing puts products at a discount to attract people to
the store.
• Bait pricing is another strategy to drive customers to the store
or website by offering a huge sale on a limited item.
• Captive pricing takes advantage of a popular product to sell
more products in that category. For example, a product can be a
loss leader (sold at a very low price) to bring more customers to
the business. We often see this in SaaS products where the
company offers a free subscription to the service. The option
only consists of a few features to demonstrate to customers what
the product can do.

Product Line Example

◦ There are many product line examples in real life. Let's look at
the Body Shop, a company specializing in beauty and skincare
products.
◦ The Body Shop has a vast product mix with seven main product
lines:
• Bath and Body
• Skincare
2
NEHA SHRIVASTAVA
2
MARKETING MANAGEMENT

• Makeup
• Hair
• Fragrance
• Men's
• Accessories
◦ Here are more examples of major brands with multiple product
lines:
• Nike's product lines include footwear, clothing, and equipment.
• Starbucks' product lines include coffee, tea, food, and
merchandise.
• Apple's product lines include Macbooks, iPhones, iPads, Apple
TV, music streaming services, desktop computers, and software.
Product Mix

Product Mix: Definition and Components

2
NEHA SHRIVASTAVA
3
MARKETING MANAGEMENT

◦ Product mix, refers to the complete range of products or services

that a company offers to its target market. It encompasses all the
individual product lines that a company offers. A product mix
includes different variations of products, such as different sizes,
flavors, colors, or features. For example, a cosmetics company
may have a product mix that includes lipsticks, foundations,
eyeshadows, and skincare products.
Components of a product mix include:
1. Product Width: This refers to the number of different product
lines that a company offers. For example, a company offering both
electronics and home appliances would have a wider product mix
compared to a company that focuses solely on electronics.
2. Product Length: Product length refers to the total number of
products within a product line. For instance, if a company offers five
different models of smartphones, the product length of its smartphone
product line would be five.
3. Product Depth: Product depth relates to the number of variations
available for each product within a product line. This could include
different sizes, colors, flavors, or configurations. For example, a
clothing brand may offer t-shirts in various sizes, colors, and styles.
4. Product Consistency: Product consistency refers to how closely
related the different product lines are to each other. Consistency can
be based on factors such as target market, distribution channels, or
production processes. For instance, a company that offers both men’s
and women’s clothing would have a less consistent product mix
compared to a company that specializes in men’s clothing.
Elements

2
NEHA SHRIVASTAVA
4
MARKETING MANAGEMENT

Example #1
◦ Suppose Company XYZ has two product lines: biscuits and
potato chips. So, all the products sold fall into the FMCG
category. The production and distribution procedures for both
product lines are the same.
◦ In this case, there are two product lines. Hence, the width of the
product portfolio is two. The mix length is the different product
types under each product line. For example, suppose the
company offers two flavors of biscuits and four flavors of chips.
The length will be six. The depth of the biscuit product line is
two, and that of the chips product line is four. Here the
consistency is high as all products belong to the FMCG
segment.
Design
 It indicates the appearance or personality of the product. The
marketers have to decide whether to go for the standard design
or the creative design.
 Changing the product’s design may be effective but can be risky
too. The customer may or may not like the design and face
problems while using the product.

2
NEHA SHRIVASTAVA
5
MARKETING MANAGEMENT

Branding
 Branding gives personality to a product; packaging and labelling
put a face on the product. Effective packaging and labelling
work as selling tools that help marketer sell the product.
 According to American Marketing Association - Brand is “A
name, term, design, symbol, or any other feature that identifies
one seller’s good or service as distinct from those of other
sellers. The legal term for brand is trademark. A brand may
identify one item, a family of items, or all items of that seller. If
used for the firm as a whole, the preferred term is trade name.”
 According to Philip Kotler - “Brand is a name, term, sign,
symbol, design, or a combination of them, intended to identify
the goods or services of one seller or group of sellers and to
differentiate them from those of competitors”
 Branding is “a seller’s promise to deliver a specific set of
features, benefits and services consistent to the buyers.”
 Branding is a process of creating a unique name and image for a
product in the mind of consumer, mainly through advertising
campaigns. A brand is a name, term, symbol, design or
combination of these elements, used to identify a product, a
family of products, or all products of an organisation.
 Branding is an important component of product planning
process and an important and powerful tool for marketing and
selling products.
Elements of Branding
 Brand includes various elements like - brand names, trade
names, brand marks, trade marks, and trade characters. The
combination of these elements form a firm's corporate symbol or
name.

2
NEHA SHRIVASTAVA
6
MARKETING MANAGEMENT

• Brand Name - It is also called Product Brand. It can be a word,

a group of words, letters, or numbers to represent a product or
service. For example - Pepsi, iPhone 5, and etc.
• Trade Name - It is also called Corporate Brand. It identifies and
promotes a company or a division of a particular corporation.
For example - Dell, Nike, Google, and etc.
 Brand Mark - It is a unique symbol, colouring, lettering, or
other design element. It is visually recognisable, not necessary
to be pronounced. For example - Coca-cola's cursive typeface.
 Trade Mark - It is a word, name, symbol, or combination of
these elements. Trade mark is legally protected by government.
For example - NBC colourful peacock, or McDonald's golden
arches. No other organisation can use these symbols.
 Trade Characters - Animal, people, animated characters,
objects, and the like that are used to advertise a product or
service, that come to be associated with that product or service.
Branding Strategies
• Brand Extension - According to this strategy, an existing brand
name is used to promote a new or an improved product in an
organisation's product line. Marketing organisations uses this
strategy to minimise the cost of launching a new product and the
risk of failure of new product. There is risk of brand diluting if a
product line is over extended.
• Brand Licensing - According to this strategy, some
organisations allow other organizations to use their brand name,
trade name, or trade character. Such authorization is a legal
licensing agreement for which the licensing organisation
receives royalty in return for the authorisation. Organisations
follow this strategy to increase revenue sources, enhance
organisation image, and sell more of their core products.

2
NEHA SHRIVASTAVA
7
MARKETING MANAGEMENT

• Mixed Branding - This strategy is used by some manufacturers

and retailers to sell products. A manufacturer of a national brand
can make a product for sale under another company's brand.
Like this a business can maintain brand loyalty through its
national brand and increase its product mix through private
brands. It can increase its profits by selling private brands
without affecting the reputation and sales of its national brand.
• Co-Branding - According to this strategy one or more brands
are combined in the manufacture of a product or in the delivery
of a service to capitalise on other companies' products and
services to reach new customers and increase sales for both
companies' brands.

Packaging
 According to Prof. Philip Kotler: “Packaging is the activity of
designing and producing the container or wrapper for
products.”
 Packaging is the act of enclosing or protecting the product using
a container to aid its distribution, identification, storage,
promotion, and usage.
 In simple terms, packaging refers to designing and developing
the wrapping material or container around a product that helps
to
• Identify and differentiate the product in the market,
• Transport and distribute the product,
• Store the product,
• Promote the product,
• Use the product properly.
Importance Of Packaging for The Seller
2
NEHA SHRIVASTAVA
8
MARKETING MANAGEMENT

• Distribution: Good packaging makes it possible for the seller to

transport the product from the manufacturing unit to the final
selling point and then to the customer. The seller uses different
packaging for the same – transport packaging to transport the
products and consumer packaging to aid the consumer in
consuming the product.
• Storage: Warehousing comes with its own risks of product
spoilage, spillage, and mishandling. Proper packaging helps the
seller store and assort the products better.
• Promotion: Packaging forms a vital marketing element that the
brand uses to differentiate the product using attractive,
colourful, and visually appealing packages and inform the buyer
about the product’s performance, features, and benefits.
• Safety: Good packaging aids in product safety before it reaches
the final consumer. For example, a Tetra Pak prevents the milk
from getting spoilt before its expiry date.
Importance Of Packaging for The Buyer
• Identification: Packaging and labelling help the customers
identify the product and differentiate it from other products in
the market.
• Usage: Often, packaging, like that of a toothpaste, that forms a
part of the product aids in its usage and consumption.
• Safety: It also protects the consumer from the dangers that the
product comes with. For example, an acid bottle protects the
user from getting acid burns.
Types Of Packaging
Primary Packaging
 Primary packaging, also referred to as consumer packaging, is in
direct contact with the product and is intended for the customer

2
NEHA SHRIVASTAVA
9
MARKETING MANAGEMENT

to identify, gain product knowledge, and to aid product

consumption.
 It’s the base packaging that emphasizes both utility and
appearance.
 It is the primary layer like the plastic pouch, cardboard box, etc.
containing the finished product, that protects and preserves the
finished product from contamination and tampering, while
including aesthetic elements that make the product stand out.
 Besides aiding identification, differentiation, and consumption,
primary packaging also acts as a promotional tool to attract
more customers at the point of sale by making the product look
more appealing.
 Some examples of primary packaging are:
• Laminated pouches for dry fruits
• Plastic containers for fruits
• Tin cans for soft drinks
• Laminated tubes for beauty products
• Composite cans for chips

Secondary Packaging
 Secondary packaging forms the second packaging layer that the
customers don’t usually see. Its main use is to group and hold

3
NEHA SHRIVASTAVA
0
MARKETING MANAGEMENT

together individual units of the product to deliver large

quantities of that product to the point of sale.
 It collates smaller product units into a single pack and aids in
inventory management (grouping and identification) before the
product is showcased to the customer.
 Some examples of secondary packaging are:
• Plastic ring that holds soda cans together, and
• Cardboard box containing multiple individual boxes of cereal,
etc.
 Removing secondary packaging doesn’t affect the product’s
quality or attributes.
Tertiary Packaging
 Tertiary packaging, also referred to as bulk or transit packaging,
is used to group a large quantity of a particular product to
transport it from point A to B.
 The main objective of this packaging is to make it easier to
transport heavy loads or large quantities of a product easily and
securely, while facilitating easy storage and handling.
 Some examples of tertiary packaging are:
• Wooden pallets used in freight shipping
• A stretch-wrapped pallet containing a large quantity of
secondary packaged goods.
Packaging Advantages
 Packaging comes with its own set of advantages. These are:
• It protects the product from any physical harm and damage.
• It helps increasing sales as it adds to the aesthetic value of the
product.

3
NEHA SHRIVASTAVA
1
MARKETING MANAGEMENT

• It keeps the product hygiene by preventing adulteration and

hampering.
• Some specialised packaging also prevents the products from
going bad.
Packaging Disadvantages
 While packaging forms an important element of a product, it
comes with its own disadvantages. These are:
• Packaging can be deceptive and may trick the customer into
getting a wrong perception of the product.
• It adds to the cost. Packaging can add to the cost of the product,
which the customer eventually bears.
• It adds to the waste that can turn hazardous, especially if it is
plastic.

Difference Between Packing And Packaging

3
NEHA SHRIVASTAVA
2
MARKETING MANAGEMENT

What is Labelling
 Labelling (Labeling) is the process of assigning a label to a
product to make it more recognizable and identifiable by adding
product information and the manufacturer. Where, a product
label may be any tag, symbol, small piece of paper, wrapper, or
means of recognition directly attached to the product.
 A label consists of valuable verbal information about the
products such as the product’s manufactured date, producer
name, address, ingredients used in products, product’s benefits,
product expiry date, how & when to use the products, and other
necessary information customers seek to know. As such the
3
NEHA SHRIVASTAVA
3
MARKETING MANAGEMENT

important information is attached to the product by labeling – it

makes customers feel blessed while identifying and making a
purchase decision on what they want to buy.
Types of Labels
Brand Label
 Brand label is the level that is used in the packaging of the
products. A brand label is a brand in itself and labels too. It is
when a company uses its brand name in the packaging of the
products.
 The brand label consists of the brand name, logo, and
trademark, and it does not consist of any other information. For
example, the logo of Honda.

Grade Label
 Grade label is when the quality of the products is shown in
grades such as numbers or words. The grade label of the
products is determined by company production standards and
legal requirements. The product’s quality grade can be in terms
of A, B, C, D, or 1,2,3,4, or good, better, best, etc. For example,
grade labels for Lipton tea.

3
NEHA SHRIVASTAVA
4
MARKETING MANAGEMENT

Informative Label
 The informative label provides various information related to
the products. It describes various aspects of the products. It
provides information on aspects like – who made it. where it
was made? when it was made? what ingredients are used? how
to use it? when to use? and so on. Since an informative label
describes the products, it is also called a descriptive label. For
example

Essentials Elements of a Label

Brand Name
 While labelling the product the brand name is vital. The brand
name is what makes your offerings different than others. The
brand name may include a logo, trademark, special character,
symbol, or any brand message however make sure the brand
name is readable and memorable.

3
NEHA SHRIVASTAVA
5
MARKETING MANAGEMENT

Product Information
 Product information includes all the significant information that
enables a product identifiable. The product name, ingredients
used in the product, packaging, description, manufactured date,
expiry date, usage instructions, size, weight, etc. As such
labeling enables it easy to know from the outside what product
is inside.
Manufacturer Information
 A good product label also includes proper information about the
product manufacturers. The label should include the company or
manufacturer’s name, address, contact details, country, zip code,
and other information that enables customers to make contact if
the company becomes the default.
Legal Information
 From country to country, the legal requirements for the product
label may be different. Thus it is necessary to study the
concerned country’s product label guidelines before attaching
anything to any labels.
Language
 While labeling the languages used must be readable and
recognizable. If the language used in the product label is un
understandable by the customers it becomes meaningless.
Though the languages vary from country to country and area to
area the languages should be used by considering the target
market languages.
UPC/Barcode
 UPC – universal product code/barcode is now also an important
part of labeling products. This makes it easy to identify the
product’s prices, manufactured dates, and other product
3
NEHA SHRIVASTAVA
6
MARKETING MANAGEMENT

essential information and makes payment billing easy just by

scanning. If the product is selling in the store barcode is
necessary.
Quality Certificates
 If the product you are selling has certificates such as No GMO,
No Toxic elements, 100% Natural, and any quality certification
marks, it should be included in the label.

Importance of Labelling
From the marketer’s point of view, labeling is important for the
following:
• It makes the marketer’s product different than those of
competitors.
• It makes marketer’s products more identifiable and memorable
in the market.
• It helps to make products attractive and attract various potential
customers.
• It helps to apply marketing campaigns more strategically, hence
increasing the number of customers and sales.
• It helps him to grade products.
• Helps him to be free from legal pressures.
• And, also increase sales and generate more profits.
From the consumer’s point of view, the importance of product
labelling can be;
• It helps customers to easily identify products.
• It helps customers to get information regarding the products and
know whether the product is right for them or not.

3
NEHA SHRIVASTAVA
7
MARKETING MANAGEMENT

• Since they easily identify the products their purchasing

decisions become more functional.
• It helps customers to get various facts about the products they
are buying such as nutrition facts, usage benefits, allergic
information, brand messages, how to use, when to use, and so
forth.
Functions of Labelling
Product Identification
 The primary function of labeling is to make products more
identifiable. It enables customers to know what particular
product they are buying by rightly adding product information.
As such customers do not confuse between substitute products.
Grading
 Labeling helps to categorize different products in different
grades. Simply, the product can be graded as A grade, B grade,
C, or D by one could stand against the other products in quality
and customers can also know what level of quality products they
are buying.
Consumer Protection
 Labeling helps customers to get informed about accurate
information about the products before making a purchasing
decision. A good product label protects customers from any
deception or fraud from the sellers. If the seller attaches
anything other than the manufacturer’s label the customer can
file against him if he had been involved in the deception
activities.
Legality Fulfillments
 An unforgettable function of labeling is that it makes firms free
from legal obligations. Product labeling is compulsory in every
nation. Here, the company may include legal information such
3
NEHA SHRIVASTAVA
8
MARKETING MANAGEMENT

as product quality grade, quality certifications, allergy

information, statutory warning (e.g. smoking is injurious to
health), etc.

Enhance Marketing Programs

 Product labeling also enhances the marketing programs of the
firm like branding and packaging. As an important element of
marketing, it makes more identifiable the product in the market
and promotes different sales promotional tools by easing
customers’ understanding of products. An effective product label
may attract more potential customers and make more sales for
the firm.
Positioning
 Positioning builds a unique image of the product in the target
audience’s mind. Also, it differentiates products from others
using benefits and attributes in the customer’s mental space.
 The product decision concerning positioning are:
1. Segmentation
2. Differentiation
3. Aggregation
Support
 Support or Customer Support is the company’s added
benefit for the customers. It may be offered to the end-user by
after-sale services, grievances management, and so on. It assists
in creating loyal customers and recurring sales.
 Different customer support services possess varied cost
structures. Therefore, marketers must make decisions to reduce
costs and improve customer experience.

3
NEHA SHRIVASTAVA
9
MARKETING MANAGEMENT

Product Life Cycle

Introduction
• PLC or Product Life Cycle is the journey of any product from its
start, growth, maturity & decline. Product life cycle (PLC) deals
with the various stages that a product goes through in the market
and the business it does. Product life cycle is an important
concept in business as it tracks the life cycle of any product,
service or brand. PLC represents the performance of sales of a
product over a period of time.
• The product life cycle is the course of a product's sales and
profits over its life time and it involves five distinct stages, viz.,
product development, introduction, growth,
maturity and decline. The product life cycle concept was
developed by Prof. Theodore Levitt and was popularized by
many scholars like, C.R. Wassen, B. Carthy, D.J. Luck, D.T.
Kollat, R.D. Blackwell and others. Product life cycle is a
theoretical demonstration of the life of a product. A product
passes through definite different stages during its life same as
human beings have a typical life-cycle going from childhood,
adolescence, youth and old age. Thus, products also follow a
similar route which is known as product life cycle (PLC). The
PLC concept shows the sales history of a product in a bell
shaped curve which depicts its life.
• Product life cycle undergoes broadly 5 different stages
i.e.product introduction, product growth, product maturity and

4
NEHA SHRIVASTAVA
0
MARKETING MANAGEMENT

then eventually product decline. The stages of PLC can be

elaborated as mentioned below:

Definition of product life cycle

• According to Arch Patton,
“Life Cycle of a product is a kin to human life cycle from several
angles. Like a man the product also takes birth, rapid growth, attains
the maturity and then enters the declining stage.”
• According to Philip Kotler,
“The product life cycle is an attempt to recognise the distinct stages in
the sales history of the product- sales history pass through four stages.
These are known as introduction, growth, maturity and decline.”
• According to William J. Stanton,
“The product life cycle concept is the explanation of the product from
its birth to death as a product exists in different stages and in different
competitive environments.”
Features of product life cycle
• Like every human life, the products also have a specified life,
divided into various stages of its life time.
• The life cycle starts with the introduction stage of the product in
the market and is followed by the growth, maturity and decline
stage.
• The whole product life cycle depicts the various stages through
which a product passes in its whole life.

4
NEHA SHRIVASTAVA
1
MARKETING MANAGEMENT

• The profitability of the firm also grows with the growth of the
product in the market which is followed by the maturity stage at
which the profitability of the product is maximum.
• Every product has its own life cycle which is distinct from the
life cycle of other products.
• Even the duration of the product at any particular stage of its life
cycle is different from the other products.

1. Introduction Stage
 When a product first launches, sales will typically be low and
grow slowly. In this stage, company profit is small (if any) as
the product is new and untested. The introduction stage requires
significant marketing efforts, as customers may be unwilling or
unlikely to test the product. There are no benefits
from economies of scale, as production capacity is not
maximized.
 The underlying goal in the introduction stage is to gain
widespread product recognition and stimulate trials of the
product by consumers. Marketing efforts should be focused on
the customer base of innovators – those most likely to buy a new

4
NEHA SHRIVASTAVA
2
MARKETING MANAGEMENT

product. There are two price-setting strategies in the

introduction stage:
1.Price skimming: Charging an initially high price and
gradually reducing (“skimming”) the price as the market grows.
2.Price penetration: Establishing a low price to quickly enter
the marketplace and capture market share, before increasing
prices relative to market growth.

Some examples of products currently in the introduction stage

include:
• Generative AI
• Self-driving cars
• 3D televisions
The main characteristics of this stage are as follows:
1. Low and Slow Sales: The growth in sales volume is at a lower
rate due to lack of knowledge about the products in the
consumers, delay in expansion of production facility, delays in
making available the product to consumers due to lack of retail
outlets of the product.
2. High promotional expenses: During this period of introduction
of the product, the promotional expenses are the highest. This is
because of small sales and high promotional efforts to create
demand. Demand for the product is created by informing
potential and present customers.
3. Highest Product Prices: The process charged at the beginning
is the highest due to low sales output and very few competitors.
There are also some technological problems also which are
encountered at the launch of the product.

4
NEHA SHRIVASTAVA
3
MARKETING MANAGEMENT

4. Narrow Product Line: In this stage, the product has only one
model and this product line is shorter and also the market area
for the product at the introductory stage is limited.
2. Growth Stage
If the product continues to thrive and meet market needs, the product
will enter the growth stage. In the growth stage, sales revenue usually
grows exponentially from the take-off point. Economies of scale are
realized as sales revenues increase faster than costs and production
reaches capacity.
Competition in the growth stage is often fierce, as competitors
introduce similar products. In the growth stage, the market grows,
competition intensifies, sales rise, and the number of customers
increases. Price undercutting in the growth stage tends to be rare, as
companies in this stage can increase their sales by attracting new
customers to their product offerings.
Some products that are currently in the growth stage are:
1.Smartwatches
2.Electric cars
The main characteristics of this stage are as follows:
1. Rapid Increase in Sales: The sales in this stage increase at a
rapid rate as the consumers become familiar with the product
and they start accepting the product. Moreover the distribution
network of the product is established at this stage. The
promotional expenses are heavy and there is product
improvement and also there is increase in number of product
items in the product line.
2. Product Improvements: in this stage, the manufacturer
improves the product quality and also adds some new features in
the product. The length of product line id enlarged by

4
NEHA SHRIVASTAVA
4
MARKETING MANAGEMENT

introducing the new versions of the product fulfilling the

requirements of different types of the customers.
3. High Promotional Expenses: In this stage of growth, the
promotional strategy of the product changes. At this stage the
product is promoted so that the customers identify the product
through its brand. Special offers, concessions, allowances are
provided.
4. Increase in profits: During this stage, the profits of the
manufacturers, retailers and the distributors increase at a rapid
rate.

3. Maturity Stage
Eventually, the market grows to capacity, and sales growth of the
product declines. In this stage, price undercutting and increased
promotional efforts are common as companies try to capture
customers from competitors. Due to fierce competition, weaker
competitors will eventually exit the marketplace – the shake-out. The
strongest players in the market remain to saturate and dominate the
stable market.
The biggest challenge in the maturity stage is trying to maintain
profitability and prevent sales from declining. Retaining customer
brand loyalty is key in the maturity stage. In addition, to re-innovate
itself, companies typically employ strategies such as market
development, product development, or marketing innovation to ensure
that the product remains successful and stays in the maturity stage.
During the maturity stage, products begin to enter the most profitable
stage. The cost of production declines while the sales are increasing.
Examples:
• Smartphones
• Video game consoles
4
NEHA SHRIVASTAVA
5
MARKETING MANAGEMENT

The main characteristics of this stage are as follows:

1. Sales increases at decreasing rate: as most of the demand of
customers is satisfied, the increase in the sales level is at
decreasing rat. This happens as the demand is of repeat sales,
competitors enter and the prices falls and selling becomes more
aggressive. Moreover, the profits are squeezed. This leads the
firms to employ extension strategies to retain their market share.
The extension strategies can be development of new products,
new uses of the products, wider range of products and
development in the style of the product.
2. Normal Promotional Expenses: During this stage, the
promotional expenses reach a normal ratio to sales. Advertising
at this stage lays more emphasis on brand promotion.
3. Product modifications: Efforts are made for product
modifications, improvements in marketing mix or product mix
becomes apparent.
4. Uniform and lower prices: Prices charged by the manufacturer
are quite lower and uniform with the competitors.
5. Profit margin decreases: In this stage, prices are lowered and
promotional efforts are made aggressive to face competition.
This lowers the profit margins of both manufacturers and
retailers.
4. Saturation
During the product saturation stage, competitors have begun to take a
portion of the market and products will experience neither growth nor
decline in sales.Typically, this is the point when most consumers are
using a product, but there are many competing companies. At this
point, you want your product to become the brand preference so you
don't enter the decline stage. To achieve this, you’ll want to focus on
providing exceptional service and building strong relationships with
your customers.
4
NEHA SHRIVASTAVA
6
MARKETING MANAGEMENT

In a saturated market, innovation also becomes essential to stay

relevant. Businesses must continuously invest in research and
development to improve products and offer new features. Failure to
do so may lead to product obsolescence and loss of market share.
Some examples of products in the saturation stage are:
Streaming services
Breakfast cereals
Soft drinks

5. Decline Stage
• In the decline stage, sales of the product start to fall and
profitability decreases. This is primarily due to the market entry
of other innovative or substitute products that satisfy customer
needs better than the current product. There are several
strategies that can be employed in the decline stage, for
example:
• Reduce marketing efforts and attempt to maximize the life of the
product for as long as possible (called milking or harvesting).
• Slowly reducing distribution channels and pulling the product
from underperforming geographic areas. Such a strategy allows
the company to pull the product out and attempt to introduce a
replacement product.
• Selling the product to a niche operator or subcontractor. This
allows the company to dispose of a low-profit product while
retaining loyal customers.
• Here are a few examples of products in the decline stage:
• DVDs & CDs and cassette tapes
• Landline telephones

4
NEHA SHRIVASTAVA
7
MARKETING MANAGEMENT

The main characteristics of this stage are as follows:

• Rapid fall in Sales: As the product becomes old and the new
products are available in the market and there is change in the
trend in the market. People get more interested in buying new
products. The sales fall shapely and over production of the
product becomes a major problem for the company.
• Further fall in prices: Due to rapid reduction in sales of the
product the company reduces prices to intensify competition to
liquidate the stock.
• No promotional expenses: Due to saturation, advertising and
sales promotion efforts lose their effectiveness. Therefore, many
companies reduce their advertising budget. Distribution network
is also reduced to the minimum. Only selected promotional
expenses are incurred
Importance of the Product Life Cycle
• The product life cycle is important because it informs an
organization’s management and decision-makers how well a
product is performing and what strategic actions it will take to
succeed. This helps companies allocate resources like staff,
budgets, shows which products should be prioritized, and where
the company should innovate next.
Other benefits of using the product life cycle include:
• Make better marketing investments and decisions
• Easier to make long-term plans
• Allows for better decision making with accurate information on
performance
• Easier to streamline current processes within your company
Product life cycle examples
• Electric vehicles
4
NEHA SHRIVASTAVA
8
MARKETING MANAGEMENT

• Electric vehicles were first developed in the early 1800s. They

fell out of favor because charging was an issue for the average
consumer. Fast forward to today. Automakers, most notably
Tesla, are shifting their focus to all-electric or hybrid
technology.
• They have been introduced to the market with a focus on
innovation and eco-friendliness as their marketing messages.
• Electric vehicles are currently in their growth stage as
companies continue to improve the design and features of their
offerings. The growth stage is extended because ongoing market
innovation leads to improvements, and that, in turn, increases
sales potential. For now, they are seeing continued growth and
the maturity stage is nowhere in sight
Factors that affect the product life cycle
• Ease of entry
Are you entering a very competitive market? The competition can
directly affect your product’s success. If small competition, low
expenses, small market size, and other barriers to entry are low, your
product’s life cycle may be shortened. If these factors are higher, your
entry may be more difficult, but your lifecycle will probably be
longer.
• Advancements in tech
If your product is in an industry that has fast tech advancement, such
as cell phones, tablets, or computers), your product’s lifecycle will
probably be quite short. To stay relevant for as long as possible, you
need to understand how fast tech evolves, what changes your target
market is looking for, and when you need to make improvements to
your product to remain competitive.
• Rate of market acceptance

4
NEHA SHRIVASTAVA
9
 MARKETING MANAGEMENT

The rate at which consumers accept your product is another factor that
influences life cycle. Look at life cycles of similar products to
estimate what your acceptance rate might be. Market research will
help you predict how quickly your product will be adopted and
accepted.
• Economic forces
The state of the economy can directly impact a product's life cycle.
Let’s look at the pandemic. For the most part, people spent less or
were more selective in their buying habits, extending new products’
introductory phase. A good economy can shorten the introductory
phase and extend the growth phase due to increased spending. The
effect of economic forces hinges on your product, target market, and
industry.

Product Life Cycle Stages and Marketing Strategies

INTRODUCTION GROWTH MATURITY DECLINE

Sales Low sales Rapidly Peak sales Declining

rising sales sales

Cost High cost per The average Low cost Low cost
customer cost per per per
customer customer customer

Profits Negative Rising High profits Declining

profits profits

5
NEHA SHRIVASTAVA
0
MARKETING MANAGEMENT

Customers Innovators Early Middle Laggards

adopters majority

Competitors Few Growing Stable beginning to Declining

number number decline number

Strategies

Introductio Growth Maturity Decline

n

Product Offer a Offer Diversify Phase-out

basic product brand and weak items
product extensions, models
service,
warranty

Price Use cost- Price to Price to Cut-price

plus penetrate match or
the market beat
competitor
s

5
NEHA SHRIVASTAVA
1
MARKETING MANAGEMENT

Distributio Build Build Build more Go

n selective intensive intensive selective:
distribution distributio distribution phase out
n unprofitabl
e outlets

Advertising Build Build Stress Reduce to

product awareness brand the level
awareness and differences needed to
among interest in and retain the
early the mass benefits most loyal
adopters market customers
and
innovators

Sales Use heavy Reduce to Increase to Reduce to a

Promotion sales take encourage minimal
promotion advantage brand level
to entice of heavy switching
trial consumer
demand

New Product Development

 There are two ways through which a firm can obtain new
products; viz., Acquisition and new product development.
 The acquisition involves buying a company, patent, or license to
produce a product for someone else.
 However, new product development is a process in which a new
product is brought to the market. New product here means
original products, product improvements, product modifications,
and new brands that the firm develops through its own research
and development efforts. Although the process of new product
5
NEHA SHRIVASTAVA
2
MARKETING MANAGEMENT

development can be time-consuming as it undergoes several

changes, it is meant to ensure that the product is as good as it
can be before it reaches the consumers and meets their demands
in the best way possible
 New Product Development refers to the complete process of
bringing a new product to market. This can apply to developing
an entirely new product, improving an existing one to keep it
attractive and competitive, or introducing an old product to a
new market.
 The emergence of new product development can be attributed to
the needs of companies to maintain a competitive advantage in
the market by introducing new products or innovating existing
ones. While regular product development refers to building a
product that already has a proof of concept, new product
development focuses on developing an entirely new idea—from
idea generation to development to launch.

IMPORTANCE OF NPD :

(i)To replace obsolete products;

(ii) To maintain and increase the growth rate/sales revenue of the
firm;
(iii) To utilise spare capacity;
(iv) To employ surplus funds or borrowing capacity; and
(v) To diversify risks and face competition.
NEW PRODUCT PLANNING:
 As a firm’s offerings enter the maturity and decline stages of the
product life cycle, it must add new items to continue to prosper
 Alternative Product Development Strategies

5
NEHA SHRIVASTAVA
3
MARKETING MANAGEMENT

The 7 stages of new product development

5
NEHA SHRIVASTAVA
4
MARKETING MANAGEMENT

1. Idea generation
 Idea generation involves brainstorming for new product ideas or
ways to improve an existing product. During product discovery,
companies examine market trends, conduct product research,
and dig deep into users' wants and needs to identify a problem
and propose innovative solutions.
 A SWOT Analysis is a framework for evaluating your Strengths,
Weaknesses, Opportunities, and Threats. It can be a very
effective way to identify the problematic areas of your product
and understand where the greatest opportunities lie.
 There are two primary sources of generating new ideas. Internal
ideas come from different areas within the company—such as
marketing, customer support, the sales team, or the technical
department. External ideas come from outside sources, such as
studying your competitors and, most importantly, feedback from
your target audience.
 Some methods you can use are:
• Conducting market analysis

5
NEHA SHRIVASTAVA
5
MARKETING MANAGEMENT

• Working with product marketing and sales to check if your

product's value is being positioned correctly
• Collecting user feedback with interviews, focus groups, surveys,
and data analytics
• Running user tests to see how people are using your product and
identify gaps and room for improvement
 Ultimately, the goal of the idea generation stage is to come up
with as many ideas as possible while focusing on delivering
value to your customers.
2. Idea screening
This second step of new product development revolves around
screening all your generated ideas and picking only the ones with the
highest chance of success. Deciding which ideas to pursue and discard
depends on many factors, including the expected benefits to your
consumers, product improvements most needed, technical feasibility,
or marketing potential.
The idea screening stage is best carried out within the company.
Experts from different teams can help you check aspects such as the
technical requirements, resources needed, and marketability of your
idea.
3. Concept development and testing
All ideas passing the screening stage are developed into concepts. A
product concept is a detailed description or blueprint of your idea. It
should indicate the target market for your product, the features and
benefits of your solution that may appeal to your customers, and the
proposed price for the product. A concept should also contain the
estimated cost of designing, developing, and launching the product.
Developing alternative product concepts will help you determine how
attractive each concept is to customers and select the one that would
provide them the highest value.

5
NEHA SHRIVASTAVA
6
MARKETING MANAGEMENT

Once you’ve developed your concepts, test each of them with a select
group of consumers. Concept testing is a great way to validate
product ideas with users before investing time and resources into
building them.
Concepts are also often used for market validation. Before
committing to developing a new product, share your concept with
your prospective buyers to collect insights and gauge how viable the
product idea would be in the target market.
4. Marketing strategy and business analysis
Now that you’ve selected the concept, it’s time to put together an
initial marketing strategy to introduce the product to the market and
analyze the value of your solution from a business perspective.
• The marketing strategy serves to guide the positioning, pricing,
and promotion of your new product. Once the marketing
strategy is planned, product management can evaluate the
business attractiveness of the product idea.
• The business analysis comprises a review of the sales forecasts,
expected costs, and profit projections. If they satisfy the
company’s objectives, the product can move to the product
development stage.
5. Product development
The product development stage consists of developing the product
concept into a finished, marketable product. Your product
development process and the stages you’ll go through will depend on
your company’s preference for development, whether it’s agile
product development, waterfall, or another viable alternative.
This stage usually involves creating the prototype and testing it with
users to see how they interact with it and collect feedback. Prototype
testing allows product teams to validate design decisions and uncover
any flaws or usability issues before handing the designs to the
development team.
5
NEHA SHRIVASTAVA
7
MARKETING MANAGEMENT

6. Test marketing
 Test marketing involves releasing the finished product to a
sample market to evaluate its performance under the
predetermined marketing strategy.
 There are two testing methods you can employ:
• Alpha testing is software testing used to identify bugs before
releasing the product to the public
• Beta testing is an opportunity for actual users to use the product
and give their feedback about it
 The goal of the test marketing stage is to validate the entire
concept behind the new product and get ready to launch the
product.
7. Product launch
 At this point, you’re ready to introduce your new product to the
market. Ensure your product, marketing, sales, and customer
support teams are in place to guarantee a successful launch and
monitor its performance.
 To better understand how to prepare a go-to-market
strategy.Here are some essential elements to consider.
• Customers: Understand who will be making the final
purchasing decisions and why they will be purchasing your
product. Create buyer personas and identify their roles,
objectives, and pain points.
• Value proposition: Identify what makes you different from the
competition and why people should choose to buy your product
• Messaging: Determine how you will communicate your
product’s value to potential customers
• Channels: Pick the right marketing channels to promote your
products, such as email marketing, social media, SEO, and more
5
NEHA SHRIVASTAVA
8
MARKETING MANAGEMENT

The Benefits of The Product Development Processes

 Superior quality products
The product development processes can lead companies to release
superior quality products. That becomes possible because the
development process involves extensive research into what the target
consumers want and the companies also seek consumer collaboration
in testing the products. They use the consumer feedback they get to
make improvements, changes, or additions to the product design,
features, and functionality. By creating superior quality products that
meet consumer requirements, the companies can gain more local,
national and international interest in their brand and products,
improve their industry standing and achieve higher sales.
 Increase in customer satisfaction
Satisfying customer requirements is one of the principal goals of new
product development. Before beginning the product development
process, companies assign teams to identify and research target
groups that are most likely to purchase their products. They note what
these groups want, what they use, and how they use products and use
this information to develop new products. After developing product
prototypes, the teams gather focus groups to collaborate with them in
testing the products and providing honest insights on their overall
appeal and usefulness. These insights enable the teams to make better-
informed decisions to create usable products.
 Advanced competitive marketability
Along with its quality, the success of a product depends to a large
extent on the ability of the manufacturing company to market it to its
target consumers. Most companies compete in their marketing with
their business rivals. Their ability to accomplish this is their
competitive marketability. The product development process can help
a company to increase its competitive marketability.

5
NEHA SHRIVASTAVA
9
MARKETING MANAGEMENT

By conducting market and consumer research, the company becomes

better placed to understand current market challenges and options and
anticipate future ones. They can review the available data and make
informed business decisions. They can brainstorm marketing ideas
and create workable solutions to expand to new markets and gain new
customers.
WHY NEW PRODUCTS FAIL?
1) Product Problems: The products fail in the market due to certain
problems with the product itself as neglect of market needs or
ignorance of market preferences, defects in product function, poor
technical design or external appearance, pool packaging or
inappropriate sizes, undependable performance or too high a variation
in quality, etc.
2) Distribution and Channel Problems : Products fail due to certain
problems in distribution such as inappropriate channels or outlets,
lack of co-operation from middlemen, poor system of physical
distribution, etc.
3) Promotional Problems: Promotional problems that contribute to
the product failure are: inadequate or ineffective promotion,
advertising directed towards wrong market segments, use of wrong
appeals, failure to co-ordinate adequately with distribution system,
improper training to sales force, etc.
4) Pricing Problems: Pricing problems such as bad forecast of price
that buyers would pay, price not on par with product quality, poor cost
estimates caused 'asking price' to be too high, inadequate margins for
the middlemen, etc., also responsible for sometimes for product
failure.
5) Competitive Problems : Competitors' aggressive strategies with
respect to product, distribution, promotion and price may cause
serious set back to the product in the market. The company had to
react defensively rather than pursuing aggressive strategies

6
NEHA SHRIVASTAVA
0
MARKETING MANAGEMENT

Consumer Adoption Process

 Consumer Adoption Process, also known as the Consumer
Adoption Cycle is basic and important in marketing, consumer
behaviour, sociology, and innovation studies that specify the
steps or stages of the process of consumer adoption that an
individual has to go through while deciding to purchase or adopt
a new product, service, technology, or idea.
 This process is helpful for businesses and marketers to better
understand the consumer’s decision-making process and the
factors that influence their choices while adopting something
new. This makes it easier for marketers and businessmen to
efficiently set strategies to select and persuade their target
customers at the necessary stages.
 It indicates a detailed journey of the consumer from being
informed about the product to purchasing or using it. This
process is adopted by many organisations that help them
strategies their ways to approach customers regardless of the
change in technology, market scenario. etc.

6
NEHA SHRIVASTAVA
1
MARKETING MANAGEMENT

Stages in the Adoption Process

Stage 1: Product Awareness

 The first stage in the consumer adoption process is simply
creating awareness that the product is available, so the company
develops a successful marketing strategy to make customers
cognizant of the new product. This strategy might include
creating a strong presence for the product in social media, for
example. The goal here is to reach as many customers as
possible at a relatively low cost. Let’s assume for a minute that
you’re watching a football game on Saturday afternoon, and you
see a television commercial for a mouthwash that whitens your
6
NEHA SHRIVASTAVA
2
MARKETING MANAGEMENT

teeth while you rinse. You’re now aware of the product, thanks
to that commercial!

Stage 2: Product Interest

In this stage, consumers are aware of the product, and it has picked
their interest. The company should guide consumers by providing
easily accessible information on the product, such as a website, blog
posts, tutorials, or instructional videos. Let’s go back to our
mouthwash example. You’re intrigued with the concept that a
mouthwash can whiten your teeth, so you call your brother who’s a
dentist to ask if he’s familiar with the product and what he has to say
about it. That’s product interest.
Stage 3: Product Evaluation
Before they buy it, consumers will typically examine, compare, and
evaluate the product. They haven’t purchased it yet, and they often
look to social media channels, such as online reviews and
recommendations, to see how other consumers feel about the product
or service. Think about it: How many times have you viewed
customer reviews on Amazon prior to purchasing a product? In our
example of the mouthwash, you might do an Internet search to read
reviews of the product before you actually purchase it. That’s product
evaluation.
Stage 4: Product Trial. This is the stage in the consumer adoption
process where the consumer actually tries the product out. It might be
a free sample in a retail store or a “100 percent money-back
guarantee” trial purchase of an online product. This is also the stage in
which marketers are hoping that the product will deliver on consumer
expectations.
Stage 5: Product Adoption. When consumers enter this phase,
they’re ready to buy, whether it’s online or in a retail store. As a
6
NEHA SHRIVASTAVA
3
MARKETING MANAGEMENT

marketer, hopefully you’ve made the acquisition and payment process

as seamless as possible so that your customers can easily obtain your
product.

New Product Adopter Categories

• Innovators: Innovators are the risk-takers in the market. As a

general rule, they have higher-than-average income and are
typically well-educated. They enjoy the “rush” of taking risk but
are also willing to accept the consequences of failure. It’s the
innovators who buy new products as soon as they hit the market.
• Early Adopters: Early adopters are actually the best target
market for new innovations. These people tend to be well-
educated “opinion leaders” with neighbors and friends, and their
product advice is generally accepted more readily than product
advice provided by innovators.
6
NEHA SHRIVASTAVA
4
MARKETING MANAGEMENT

• Early Majority: The early majority typically look to the

innovators and early adopters to determine if the new product
meets expectations because they don’t want to take the risk of
being the first to adopt the new product, but they do accept
innovation before the “average person.” This group of
consumers is typically above average in terms of education and
income but also tend to be “followers” in their social group.
• Late Majority: Consumers in the late majority category are
typically slow to catch on to the popularity of new services,
products, ideas, or solutions. About 34 percent of the population
will buy a new product only after about half of the population
does. They’re not interested in the “bells and whistles” (i.e.,
functionality and benefits) of the “latest model” and want
simple, cost-effective products that focus on specific uses. As a
general rule, their income and education are limited, and they’re
typically unwilling to take a chance with a new product unless
the majority of consumers has already adopted the innovation.
• Laggards: Laggards are more in tune with the past than the
future, and they’re leery of new ideas. By the time they adopt a
product, there’s probably already a new version or innovation
taking its place.

6
NEHA SHRIVASTAVA
5