The Main Stages of PLC Essay Example | Topics and Well Written Essays - 1500 words

The Main Stages of PLC - Essay Example The question of which to use, or where on this continuum to operate, must be made at the introductory stage of the PLC. PLC distinguishes five market-opportunity phases: entry, establishment, expansion, maturity, and decline; and indicates the kind of opportunity analysis that should go into developing the marketing mix (see Appendix 1). This chart shows that markets increase slowly at first, and then increase at an increasing rate, reach maturity, and finally decline (Drejer 62). The time period for this cycle varies by products. Consider the difference in cycle among the dress industry, the lumber industry, and the computer industry. Also, different companies choose to enter markets during different developmental phases. Even so, management must be aware that marketing tasks of a phase 1 situation are different from those relevant to phase 4 (Crawford and Benedetto 44). In the initial phase (market entry), there is no direct competition. Computer games manufacturing should take into account the fact that the tasks of marketing programs and strategies are those of gaining initial market acceptance and changing habits. They are concerned with creating primary demands for the product, providing customer and consumer information, identifying market segments, gaining market knowledge, soliciting channel support, and promoting to gain a foothold in the marketplace. A common market price emerges in this stage, with the range of acceptable prices narrowing (Crawford and Benedetto 44). The marketer is encountering downward pressure on prices, although this depends on the extent of product differentiation among competitors and the rate at which technological improvements are being made to the product. At this stage, a computer games manufacturer should find the most effective channel strategies and promotions activities in order to plan and develop the furth er campaign. For a computer game, traditional marketing channels (through specialized stores) and direct selling methods will be the most effective channels of distribution. It will be appropriate to use a skimming price in order to attract more users, and popularize the new product. The main promotion techniques are advertising and press conferences aimed to inform community about benefits and uniqueness of the new computer game (Drejer 63). Establishment The second phase is characterized by endeavors to establish markets. In this phase, limited direct competition exists, and potential competitors begin to notice the situation. The functions of marketing programs and strategies are to solidify and extend market footholds and to establish differential advantage. Marketing activities center around gaining brand acceptance and developing customer loyalty. The attempt is to establish a market niche. Also, in the growth stage individual need or benefit segments may surface (Grieves 98). A benefit segment is a sizable group of buyers that places heavy emphasis on a specific product attribute or particular mix of attributes. These segments will often differ in their willingness to pay for specific attributes (e.g., faster delivery, smaller inventories, better service, a special feature). There may, at this stage, still be a substantial amount of