A new product progresses through a sequence of stages from introduction to growth, maturity and decline. This sequence is known as the product life cycle and is associated with changes in the marketing situation. The product life cycle has a major impact on marketing strategy and marketing mix.
(C) Maturity Stage:
In this stage, the product reaches to its top stage (at the peak level) and it is fully established into the market. This stage is the most important stage for two reasons
- It is the longest stage in the life of a product
- It poses challenges to marketing management.
Maturity stage can be further sub-divided into three phases
- Growth Maturity: During this phase, the sales growth starts declining or sales continue to increase but at a diminishing rate. The increase in sales is due to entry of some laggard consumers in the market.
- Stable Maturity: During this phase, there is no growth in sales or it remains constant. The reason for no increase in demand is that most of the potential consumers have already tried the product and future sales depend upon population growth and replacement demand. This is the saturation point because sales are maximum.
- Decaying maturity: During this phase, sales start declining because current customers start switching to other products and substitutes. This is the most important stage because sales start declining for the first time in the history of the product’s life cycle.
- Sales: During the maturity stage, sales of the company reach the saturation point (i.e.) peak sales. It means that it becomes difficult for the company to increase sales.
- Costs: During the same stage, cost per customer further falls as a result of increase in sales and decline in promotional expenses.
- Profits: Due to rise in sales and reduction costs, the profits start rising and the company reaches the saturation point, It means the profits are highest.
- Customers: During maturity stage, because the majority of people now know that product features, qualities etc. The company attracts maximum customers during this stage. These customers are known as middle majority. (early and late majority)
- Competitors: During this stage, the number of Competitors remains more or less same or starts declining
Strategies During Maturity Stage:
- Market Modification:
(i) Convert non-users: First the company can try to attract non-users to buy the product. This can be done by convincing them about the benefits of using of a new product. (ii) Enter New markets or market Segments: Second, the company can try to enter new demographic or geographic market segments. (iii) Win competitors’ Customers: the company can attract customers of other competitors to try or adopt the product.
- Product Modification:
(i) Quality Improvement: The quality improvement means increasing the functional performance of the product. The chance in quality of the product increases the durability, reliability, speed and taste. (ii) Feature Improvement: This strategy aims at adding new features into the existing features to the product for increasing the versatility, safety or convenience of the product. (iii) Style Improvement: The style improvement increases the aesthetic appeal of the product. It means that we can attract new customers by making the product more attractive. So people do not mind paying more price for the same product which has aesthetic appeal.
- Marketing Mix Modification:
(i) Price: reducing price through volume discounts, early bird discount, easier credit terms etc (ii) Advertising: increasing advertising expenditure, change advertising message or copy change media mix or change timing and frequency of ads, more effective advertising campaign (iii) Sales Promotion: more aggressive sales promotion by offering trade deals, rebates, Rs-off Coupons, warranties, gifts and contests (iv) Distribution: getting more support from the existing channel or increasing the number of outlets or moving to higher volume market channel or shifting from existing channel of distribution to new distribution channels. (v) Personal Selling: Increasing the number of sales persons or improving quality of sales people, or revising sales territories or incentive given to sales force (vi) Services: speeding up delivery or extending more technical support to customers or extend more credit