Modifying the market: Glad helps customers to swap new uses for its Press'n Seal wrap on it's "1000s of Uses. What's Yours?" Web site.
Products Company helps customers to find new uses for its Press'n Seal wrap, the plastic wrap that creates a lid-like seal. As more and more customers contacted the company about alternative uses for the product, Glad set up a special "1000s of Uses. What's Yours?" Web site (www.1000uses.com) at which customers can swap usage tips. "We found out our heavy users use it for a lot more than just covering food," says a Glad brand manager. "And they all became heavy users when they had an 'aha' moment with Press'n Seal." Suggested uses for Press'n Seal range from protecting a computer keyboard from dirt and spills and keeping garden seeds fresh to use by soccer moms sitting on damp benches while watching their tykes play. "We just roll out the Glad Press'n Seal over the long benches," says the mom who shared the tip, "and everyone's bottom stays nice and dry."34
The company might also try modifying the product—changing characteristics such as quality, features, style, or packaging to attract new users and to inspire more usage. It can improve the product's styling and attractiveness. It might improve the product's quality and performance—its durability, reliability, speed, and taste. Thus, makers of consumer food and household products introduce new flavors, colors, scents, ingredients, or packages to enhance performance and revitalize consumer buying. For example, TABASCO hot pepper sauce may have been around for more than 130 years, but to keep the brand young, the company has added a full line of flavors (such as Garlic, Sweet & Spicy, and Chipotle) and a kitchen cabinet full of new products under the TABASCO name (such as steak sauces, spicy beans, a chili mix, jalapeno nacho slices, and even a TABASCO lollipop).
Finally, the company can try modifying the marketing mix—improving sales by changing one or more marketing mix elements. The company can offer new or improved services to buyers. It can cut prices to attract new users and competitors' customers. It can launch a better advertising campaign or use aggressive sales promotions—trade deals, cents-off, premiums, and contests. In addition to pricing and promotion, the company can also move into new marketing channels to help serve new users.
The sales of most product forms and brands eventually dip. The decline may be slow, as in the case of oatmeal cereal, or rapid, as in the cases of cassette and VHS tapes. Sales may plunge to zero, or they may drop to a low level where they continue for many years. This is the decline stage.
Sales decline for many reasons, including technological advances, shifts in consumer tastes, and increased competition. As sales and profits decline, some firms withdraw from the market. Those remaining may prune their product offerings. They may drop smaller market segments and marginal trade channels, or they may cut the promotion budget and reduce their prices further.
Carrying a weak product can be very costly to a firm, and not just in profit terms. There are many hidden costs. A weak product may take up too much of management's time. It often requires frequent price and inventory adjustments. It requires advertising and sales-force attention that might be better used to make "healthy" products more profitable. A product's failing reputation can cause customer concerns about the company and its other products. The biggest cost may well lie in the future. Keeping weak products delays the search for replacements, creates a lopsided product mix, hurts current profits, and weakens the company's foothold on the future.
For these reasons, companies need to pay more attention to their aging products. A firm's first task is to identify those products in the decline stage by regularly reviewing sales, market shares, costs, and profit trends. Then, management must decide whether to maintain, harvest, or drop each of these declining products.
Management may decide to maintain its brand without change in the hope that competitors will leave the industry. For example, Procter & Gamble made good profits by
The product life-cycle stage in which a product's sales decline.
remaining in the declining liquid soap business as others withdrew. Or management may decide to reposition or reinvigorate the brand in hopes of moving it back into the growth stage of the product life cycle. Procter & Gamble has done this with several brands, including Mr. Clean and Old Spice.
Management may decide to harvest the product, which means reducing various costs (plant and equipment, maintenance, R&D, advertising, sales force) and hoping that sales hold up. If successful, harvesting will increase the company's profits in the short run. Or management may decide to drop the product from the line. It can sell it to another firm or simply liquidate it at salvage value. In recent years, P&G has sold off a number of lesser or declining brands such as Crisco oil, Comet cleanser, Sure deodorant, Duncan Hines cake mixes, and Jif peanut butter. If the company plans to find a buyer, it will not want to run down the product through harvesting.
• Table 9.2 summarizes the key characteristics of each stage of the product life cycle. The table also lists the marketing objectives and strategies for each stage.35
• table | 9.2 Summary of Product Life-Cycle Characteristics, Objectives, and Strategies
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