MKTG 1030 WEEK 7

What is a business’ objective?

• deliver shareholder profit

What does PLC stand for?

Product Life Cycle

What is the PLC?

tool managing product stage

What are the PLC factors?

• never in success

• remain in stage

• global difference

• varied marketing method

What is an example of a short PLC product?

• computer

What is an example of a long PLC product?

• jewelry

• kitchen

What are the PLC stages?

• intro

• growth

• maturity

• decline

What is the first PLC stage?

• introduction

What is the second PLC stage?

• growth

What is the third PLC stage?

• maturity

What is the fourth PLC stage?

• decline

What PLC stage has the highest marketing cost & lowest profit?

• introduction

Why does the first PLC stage have the highest marketing cost & lowest profit?

• R&D

Who has distribution access in the first PLC stage?

• early adopter

What is penetration pricing?

price strategy

• low initial price

What is penetration pricing’s use?

• encourage customer to try product

What is skimming pricing?

• high initial price

What is skimming pricing’s use?

• quick initial investment recovery

What PLC stage accepts the product by the market?

• growth

What PLC stage encourages competition?

• growth

Why does the second PLC stage encourage competition?

• increased sale

• attractive profit

What does the second PLC stage require to ensure availability?

• expanded distribution

• increased production

True or False: Pricing during the second PLC stage fluctuates.

False: Pricing during the second PLC stage remains constant.

Why do sales level off in the third PLC stage?

• eroded demand

• replacement / repeat sale > new customer

What PLC stage only has the strongest suppliers survive?

• maturity

What are the ways to extend life cycles on existing products?

• enter new market

• modify target market & marketing strategy

• add new feature

What comprises the second PLC stage packaging strategy?

• redesign

What comprises the second PLC stage quality strategy?

• add new feature extending use

What comprises the second PLC stage quantity strategy?

• increased amount for equal price

What are the ways to extend life through new markets?

• global

• online

• substitute

What obsoletes products in the fourth PLC stage?

• tech

True or False: Product sales decrease at an increasing rate.

True

What is product harvest?

• reduce cost to maintain profit

How might a business avoid the fourth PCL stage?

• modify product during maturity

What does the BCG Matrix look like?

What is the BCG matrix’ x-axis?

• relative market share

What is the BCG matrix’ y-axis?

• market growth

What comprises a star?

• high relative market share

• high market growth

What comprises a question mark?

• low relative market share

• high market growth

What comprises a cash cow?

• high relative market share

• low market growth

What comprises a dog?

• low relative market share

• low market growth

What is the BCG matrix question mark’s strategic option?

• opportunity development

How can the BCG matrix question mark undertake its strategic option?

• select investment = star OR dog

• identify niche & strategy

What is the BCG matrix star’s strategic option?

• growth investment

How can the BCG matrix star undertake its strategic option?

• aggressive marketing

  • selling

  • advertising

  • pricing

  • promoting

What is the BCG matrix cash cow’s strategic option?

earnings management

How can the BCG matrix cash cow undertake its strategic option?

• expand successful / divest unsuccessful product line

• differentiate & maintain / increase brand awareness / loyalty

  • price stability key

What is the BCG matrix dog’s strategic option?

harvest / divest

How can the BCG matrix dog undertake its strategic option?

• harvest: target niche

• save operation / distribution cost

What are the business growth ways?

• acquisition

• organic growth

What are some acquisition examples?

• product

• tech

• business

What are some organic growth examples?

• inhouse development

What are the organic innovation kinds?

• incremental

• radical / disruptive

What is incremental / sustaining innovation?

• add to existing business / product / tech

What is radical / disruptive innovation?

• target different & unattractive market

• rely on different performance characteristic

• require different business model

• transform chain / asset value role & skillset

What do performance trajectories look like?

What is the current performance trajectory relationship?

disruptive > mainstream > incremental

What is the expected performance trajectory relationship?

mainstream > disruptive > incremental

What does the Ansoff matrix look like?

What is the Ansoff matrix?

• product & marketing entry strategies

What is on the Ansoff matrix’ x-axis?

• existing / new product

What is on the Ansoff matrix’ y-axis?

• existing / new market

What comprises market penetration?

• existing product

• existing market

What comprises product development?

• new product

• existing market

What comprises market development?

• existing product

• new market

What comprises diversification?

• new product

• new market

What is the Ansoff matrix?

strategy tool helping business decide how to grow

What are the new product development key factors?

• potentially large & growing market

• market expertise

• proven process

What are a growing market’s characteristics?

• higher demand

• creative room

• fund access

• quick scale

• early brand

• lower barrier

Why is increased demand a growing market characteristic?

• get business by being there without taking from competitor

Why is creative room a growing market characteristic?

• undefined rules

Why is fund access a growing market characteristic?

• investor knows markets promise high potential returns

Why is quick scale a growing market characteristic?

• doesn’t require cheaper / better business

Why is early brand a growing market characteristic?

• no entrenched incumbent

Why is lower barrier a growing market characteristic?

• few rules

What entrepreneur expertise obtains higher success?

• manager experience

• effective family entrepreneur

• unique knowledge

• unique employee knowledge

What does the Booze Allen Hamilton Study conclude?

no R&D and …

• growth

• profitability

• shareholder return

relationship

True or False: The process identifying and bringing market opportunities is less important than the cost.

False: The process identifying and bringing market opportunities is more important than the cost.

What are the consumer purchase process stages?

• need recognition

• info search

• product evaluation

• product choice & purchase

• post-purchase use

• disposal

What are the new product process stages?

• opportunity identification

• concept

• product & plan

• business

What comprises the opportunity identification stage?

• scan option

What comprises the concept stage?

• develop (concept)

What comprises the product & plan stage?

• develop venture

What comprises the business stage?

• upscale venture

What is a new product process decision point?

• decide to continue venture

What are the new business creation factors?

• perception = reality

• branding = most important product differentiation aspect

• single strategy

• understand web

What are the Lemon Coast Soap (P&G) case study key takeaways?

• market consumer perception = reality

• behaviour & preference insight = innovation tool

• try something

What are the Universal Music case study key takeaways?

• brand >

• stand for … something > everything

• media = variable cost

• endorsement differentiates

What are the Mill Street Brewery case study takeaways?

• strategy: what you aren’t = what you are

• small = nimble / responsive / proactive

• right niche can win

• innovation can go back

• don’t be afraid to give what customer asks for

What are the Colleges Ontario case study key takeaways>

• figure out in category

• emotional connection = key opportunity

• relationship + leveraged function benefit = powerful package

What are some ways to understand customers?

• focus group

• survey

• 1-on-1 interview

• ethnography

• netnography

What questions does the Ansoff matrix ask?

• should we sell more of what we already have?

• should we try something new?

What PLC stage associates with BCG matrix stars?

• intro

What happens to BCG matrix stars with more investment?

• be future cash cow

What PLC stage associates with BCG matrix question marks?

• growth

What must businesses decide with BCG matrix cash cows?

• invest

or

• drop

What happens to BCG matrix question marks with more investment?

• be future star

What PLC stage associates with BCG matrix cash cows?

• maturity

What comprises a BCG matrix cash cow?

• steady income

• low investment

What PLC stage associates with BCG matrix dogs?

• decline