Decline phase strategy: Difference between revisions
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This is the last phase of the life cycle of the [[product]]. It is characterized by a clear decline in sales and declining revenue as a result of the emergence of a number of substitutes, saturation of the [[market]] or changes in fashion. In this phase, companies limit [[production]], distribution and sale activities. They also use seasonal sales with a significant decrease in prices. | |||
==How to extend product life?== | |||
There are several strategies that companies can use to extend the life of a product in the decline phase: | |||
* [[Cost]] reduction: Companies can reduce costs by cutting back on production and distribution activities, as well as by using cheaper materials. | |||
* Rebranding: Rebranding a product can help to revitalize its [[image]] and make it more attractive to consumers. | |||
* [[Diversification]]: Diversifying a product line can help to spread out [[risk]] and maintain revenue streams. | |||
* Repositioning: Repositioning a product can help to target new markets or [[customer]] segments. | |||
* Creating new [[demand]]: Companies can create new demand for a product by offering new features, benefits, or services that are not offered by competitors. | |||
* [[Innovation]]: Introducing new [[technology]] or features to the product can create new demand and extend the life of the product. | |||
* [[Price]] strategy: Lowering the price can also increase demand and extend the product's life. | |||
* Increase in advertising or promotion: Increase in advertising or promotion can increase the awareness of the product and attract new customers. | |||
Ultimately, the success of these strategies will depend on the specific product and [[market conditions]], and it's best to test different strategies before making a decision. | |||
==Proposed actions== | ==Proposed actions== | ||
| Line 20: | Line 18: | ||
* maintain position | * maintain position | ||
* invest [[company]] resources | * invest [[company]] resources | ||
===Strong competitive position=== | ===Strong competitive position=== | ||
* maintain position or use harvest [[strategy]] | * maintain position or use harvest [[strategy]] | ||
* minimum [[investments]] from own resources | * minimum [[investments]] from own resources | ||
===Average competitive position=== | ===Average competitive position=== | ||
* harvest [[strategy]] or a gradual withdrawal | * harvest [[strategy]] or a gradual withdrawal | ||
* maintaining the minimum investment or disinvestment | * maintaining the minimum [[investment]] or [[disinvestment]] | ||
===Favourable competitive position=== | ===Favourable competitive position=== | ||
* gradual withdrawal or abandonment | * gradual withdrawal or abandonment | ||
* disinvestment or disposal | * disinvestment or disposal | ||
===Weak competitive position=== | ===Weak competitive position=== | ||
* abandonment, | * abandonment, | ||
* disposal | * disposal | ||
{{infobox5|list1={{i5link|a=[[Maturity phase strategy]]}} — {{i5link|a=[[Product strategy]]}} — {{i5link|a=[[Penetration strategy]]}} — {{i5link|a=[[Market maturity]]}} — {{i5link|a=[[Market expansion]]}} — {{i5link|a=[[Growth phase strategy]]}} — {{i5link|a=[[Prestigious price strategy]]}} — {{i5link|a=[[Aggressiveness strategy]]}} — {{i5link|a=[[Pricing strategy]]}} }} | |||
==References== | ==References== | ||
* Cox, W. E. (1967). [http://www.jstor.org/stable/2351620 Product life cycles as marketing models]. The Journal of Business, 40(4), 375-384. | * Cox, W. E. (1967). [http://www.jstor.org/stable/2351620 Product life cycles as marketing models]. The Journal of Business, 40(4), 375-384. | ||
[[Category:Marketing strategies]] | [[Category:Marketing strategies]] | ||
[[pl:Strategia fazy schyłkowej]] | [[pl:Strategia fazy schyłkowej]] | ||
Latest revision as of 19:49, 17 November 2023
This is the last phase of the life cycle of the product. It is characterized by a clear decline in sales and declining revenue as a result of the emergence of a number of substitutes, saturation of the market or changes in fashion. In this phase, companies limit production, distribution and sale activities. They also use seasonal sales with a significant decrease in prices.
How to extend product life?
There are several strategies that companies can use to extend the life of a product in the decline phase:
- Cost reduction: Companies can reduce costs by cutting back on production and distribution activities, as well as by using cheaper materials.
- Rebranding: Rebranding a product can help to revitalize its image and make it more attractive to consumers.
- Diversification: Diversifying a product line can help to spread out risk and maintain revenue streams.
- Repositioning: Repositioning a product can help to target new markets or customer segments.
- Creating new demand: Companies can create new demand for a product by offering new features, benefits, or services that are not offered by competitors.
- Innovation: Introducing new technology or features to the product can create new demand and extend the life of the product.
- Price strategy: Lowering the price can also increase demand and extend the product's life.
- Increase in advertising or promotion: Increase in advertising or promotion can increase the awareness of the product and attract new customers.
Ultimately, the success of these strategies will depend on the specific product and market conditions, and it's best to test different strategies before making a decision.
Proposed actions
The dominant competitive position
- maintain position
- invest company resources
Strong competitive position
- maintain position or use harvest strategy
- minimum investments from own resources
Average competitive position
- harvest strategy or a gradual withdrawal
- maintaining the minimum investment or disinvestment
Favourable competitive position
- gradual withdrawal or abandonment
- disinvestment or disposal
Weak competitive position
- abandonment,
- disposal
| Decline phase strategy — recommended articles |
| Maturity phase strategy — Product strategy — Penetration strategy — Market maturity — Market expansion — Growth phase strategy — Prestigious price strategy — Aggressiveness strategy — Pricing strategy |
References
- Cox, W. E. (1967). Product life cycles as marketing models. The Journal of Business, 40(4), 375-384.
