Product Positioning & Product Product Positioning & Product Life Cycle Life Cycle

Dr. Prashant MehtaAssistant Professor, National Law University, Jodhpur

Email: prashantmehta1@rediffmail.com

Product DifferentiationProduct Differentiation

Most competitive advantages lasts only a short time. Companies therefore constantly need to think up new value adding features and benefits to win the attention and interest of

choice rich, price prone consumers.

DifferentiationDifferentiation

It is the act of designing a set of meaningful differences to distinguish the company’s offering in terms of products

and services from competitors.

How can you differentiate?How can you differentiate?

Differentiation can be done in variety of ways depending on the industry, sector, product, and service category.

Differentiation can occur in one or more of these areas – product, product features, services, personnel, channel,

image and so on………………………………………...

Product DifferentiationProduct Differentiation

Form

Features

Performance

Conformance

Quality

Durability

Reliability

Reparability

Style

Design

Brand Image

Services DifferentiationServices Differentiation

Ordering Ease

Delivery

Installation

Customer Training

Maintenance and Repair

Service Contract

Miscellaneous Services like upgrade of Product or Feature

Information of New launches etc.

Personnel DifferentiationPersonnel Differentiation

Competence of Personnel

Courtesy

Credibility

Reliability

Responsiveness

Communication Skills

Channel DifferentiationChannel Differentiation

Trade Shows

Direct Channel

Online Channel

Indirect Channel

Image DifferentiationImage Differentiation

Identity – what the company wants to project

Image – what the public perceive

Image can be enhanced by using, symbols, media, atmosphere, events and employee behaviour

Relevant DifferentiationRelevant Differentiation

Differentiation must be meaningful and relevant to the consumer. So it should satisfy the following criteria:

Important Use

Distinctive Brand

Superior Quality

Affordable Price

Profitable to Company

Value to Customer

High Brand Value and Recognition

USPUSP

This product should be exclusive to the brand and make a significant relevant impact in the minds of

consumer.

It should ignite a passion of owing one.Eg: I Phone

PositioningPositioning

The act of designing the company’s offering and image to occupy a distinctive place in the consumer’s mind.

Positioning normally takes one position in the mind. More than one, the company runs the risk of customer credibility

and dilution of positioning.

Positioning StrategiesPositioning Strategies

Attribute

Benefit

Competitor

Use or application

User

Product category

Price /Quality

PLCPLC

Products have a limited life

Product sales pass through distinct stages

Profits rise and fall at different stages of the PLC

Product require different strategies in each stage of the PLC

The Product Life Cycle

Time

Sal

es o

r P

rofi

ts

Growth

Maturity

Decline

Introduction

Profit curve

Sales curve

Strategies - IntroductionStrategies - Introduction

Skimming the market

Penetrating the market

Must have sufficient resources to withstand the initial losses and heavy promotion costs

Incremental selling efforts at this stage is highest

The Competitive CycleThe Competitive Cycle

NewIntroduction

Growth ofIndustry

Excesscapacities

High Inventories

ReductionIn margins

New entrantsdiscouraged

Existingcompaniesconsolidate

Weakercompanies withdraw

Market Share Increases

Strategies - GrowthStrategies - Growth

Improves quality and adds features

Adds new models and variants

Enters new market segments

Increases distribution coverage and adds new channels

Shifts communication from awareness to preference building

Scale economies enable it to lower prices to attract the next level of price conscious buyers

Strategies - MaturityStrategies - Maturity

Most products are in this stage

Price wars are inevitable.

Scramble for market share

The fittest survive

Market modification, product modification, marketing mix modification can help extend the maturity stage

Strategies - DeclineStrategies - Decline

Withdrawal

Rationalization of Products

Harvesting whatever is possible

Divesting the Product

Removing it From Market

Market EvolutionMarket Evolution

Emergence

Growth

Maturity

Decline