Introduction: When a product will launch, then it might have no awareness among

Question

Introduction:

When a product will launch, then it might have no awareness among the target customers. At this stage, product will started gaining popularity through various promotional methods. At this stage, a product will give low profit due to low sales. At this stage, prices might be high due to skimming as a strategy.

Growth:

This stage will be recognized for a product, having great demand. Product will be accepted by different market segment. Here, a huge competition might be seen with other similar kind of products. A good profit margin will be achieved due to economies of scale and hence cost reduction for the production.

Maturity:

At this stage, product will earn a profit but it will start stabilize to a level which can only be changed with huge expenses on promotion. Here, competition will be increased with more number of products. Heavy advertisements might be required. It will be a better strategy to launch differentiated goods so as to get new customers.

Decline:

At this stage, the demand for product will be dropped to a low level. Here, companies profit might be reduced or even comes in minus due to decreased sales. A company might sale or divest its business. Unfavourable economic conditions will be prevalent in the market.

2)PLC and Channel management interconnection:

The role of channel management is quite challenging due to various factors associated with these marketing intermediaries (wholesalers, retailers etc.). In case of PLC, the implications of channel management will be described in the following points,

1) At the introduction stage, a company should offer maximum benefits to its retailers so that to add a huge number of retailers for smooth distribution of the product & services. These retailers and distributors will cover a wider geographical area.

2) At the growth stage, a company should wisely choose the channel partners. It must set out issues with them. A proper margin and services must be ensured by the company.

3) At maturity level, a company might motivate the channel members to encourage customers to purchase goods. Discount offers might be introduced by company. A target might be given so as to boot the overall sales of the company.

4) At decline stage, a company should try to change the policy related to channel partners. The margin might be reduced. Even, some of the unproductive and non profit giving channel partner might be closed.

Explanation / Answer

Qu #41: each stage for the channel management. (30 points) (a)_ Discuss the product life cycle stages and (b) Discuss the basic implications of abs Save

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