Chapter 10
Life Cycle Management
 From cradle to grave management of the product
 Fine-tuning strategy
 Defending against competitors
 Continuously innovating the product, if possible
Product
Life
Cycle
 Similar to S-curve for product diffusion
 Four distinct stages of a product’s life
 Introduction
 Growth
 Maturity
 Decline
 Different development costs, sales, and marketing
costs in each stage (Kahn, p. 183)
 Different marketing mix strategies for each stage
(Exhibit 10.2, p. 184)
Maturity Stage Considerations
 Three basic strategic options
 Maintenance – fine tune marketing mix for optimal
profitability
 Defense – focus on a key marketing element important
to the customer base
 Innovation – use line extensions, flankers, or new
markets to extend the life of the product
Product Families and Platforms
 Expanding beyond a single product in a category
 Platforms typically have an underlying foundation of
common design elements
 Product families are “products that share a common
platform” but are customized for specific user
requirements (Dodge Durango versus Chrysler Aspen)
Mapping the Product Mix
 Visual representation of the different products
 List the current product, and group by product line
 Possibly utilize a time element of product introduction
 Group product lines by common platform elements
 Identify possible overlaps or gaps in the lines
Brand Management
 Brand is a promise from the company to the buyer
about certain inherent characteristics of the product
 Mercedes brand promise is extreme quality
 Wal-Mart brand promises lowest price
 Over time, brands develop equity – the difference
between assets and liabilities on the balance sheet
Brand Equity Framework
 Aaker says brand equity is five key components
 Brand loyalty – degree of repeat purchases
 Brand awareness – consideration set
 Perceived quality of the brand
 Brand associations – signals connected to the brand
(memorable events, memories, etc.)
 Other proprietary brand assets – patents, trademarks,
channel relationships, etc.
 Example in Exhibit 10.4, page 190
Brand Equity Measurement
 Brand Loyalty
 Price premium
 Customer satisfaction
 Brand Awareness
 Salience
 Perceived Quality
 Expectations and
performance met
 Leadership in category
 Brand Associations
 Perceived value
 Brand personality
 Organizational
associations
 Market Behavior
 Market share
 Market price
 Distribution coverage
Brand Decision Framework
 Five major decisions regarding a brand
 Branding decision – to brand or not to brand
 Brand sponsor decision – manufacturer, distributor, or
licensed brand
 Brand name decision – individual names, blanket family
name, separate family name, company/individual name
 Brand strategy – line extension, brand extension, multibrands, new brands, co-brands
 Brand repositioning decision – reposition or not
Brand Switching Matrix
 Switching behavior from former brand to current
brand
 Based on consumer input
 Identifies for a specific brand the source (former
brand) of their new customers and the destination
(new brand) of some of their existing customers
 Example in Exhibit 10.6, page 197