Innovation Stage
Innovation is creating something new and it is often what excites and motivates a businessperson to establish a business. It is the creation of a new product or service which provides real benefits to the consumer
Introduction Stage
The business tries to increase consumer awareness and build market share for the product
- product - brand and reliability are established
- price - normally lower that competitors prices
- distribution - is selective, consumers able to form acceptance of product
- promotion - directed at early buyers and users, seek to educate potential customers
Growth stage
Brand acceptance and market share are actively pursued by the producers of the product
Product - maintained and improved and support services may be added
Price - price per unit of production is maintained as the business enjoys increased customer demand and growing market share
Promotion - now seeks wider audience
Maturity stage
Sales plateau as the market becomes saturated
Product - features and packaging try to differentiate it from those of competitors
Price - may be adjusted to hold off competitors and maintain market share
Distribution - incentives may need to be offered to encourage preferences over rival products
Promotion- promotion continues to suggest the product is tried and true-it’s still the best
Decline stage
Sales begin to decline as the business faces several options
Product - product is discontinued. Either sell product to another business or make improvements
Price - is reduced to sell remaining stock
Distribution - distribution channels are reduced and product only offered to loyal segment of the market
Promotion - is discontinued over time
What are the 5 stages if the product life cycle ?
- Innovation Stage
- Introduction Stage
- Growth Stage
- Maturity Stage
- Decline Stage
Steps taken by a Marketing Manager
- Establishing Marketing Objectives
- Monitor Performance
- Evaluate Performance
- Take Corrective Action
What are the 3 performance indicatiors
- Sales Performance - uses sales data to evuluate the business’ current performance and the effectiveness of the marketing mix
- Market share Performance
- Marketing Profitability Analysis - breaking down total marketing costs into specific marketing activities,, to see the effectiveness of each activity
Globalisation
Is the effect of ever more sophisticated communications technology, lower transport costs, and unrestricted trade and financial flows turning the whole world into a single market, producing a more integrated global economic system.
Globalisation and SMEs
The process of globalisation means many more Australian SMEs are now successfully marketing their products to overseas markets. Today, many SME owners regard the marketplace as no longer local and real, but instead global and virtual
Criticisms of marketing
- creation of needs - manipulate
- product placement
- stereotypical
- use of sex to sell products
- truth and accuracy in advertising
- invasion of privacy
- sponsorship deals
- marketing junk food to children
Two purposes of Australia competition and consumer act
- two protect consumers against undesirable practices, such as misleading and deceptive advertising
- to regulate certain trade practices that restrict competition. The government also wants to ensure a number of businesses are operating at any one time in the same market, to encourage competition
Marketing practices covered by the Australian Competition and Consumer Act
- misleading advertising
- price discrimination
- implied condition or terms - (acceptable quality and fitness of purpose)
- warranties - false or misleading statements not allowed
- resale price maintenance - supplier insists retailer sells at particular price - illegal
