STRATEGIC MARKETING

Strategic Marketing

Strategic Marketing

Introduction

Discovering the real desires, wants, and needs of the customer and designing product mix to actually meet those needs requires detailed analysis of the target market and the resources available to the organization. Strategic Marketing is a catchall term that describes marketing activities based on carefully crafting a marketing plan. It often involves marketing outreach directed towards specific constituencies.

Guido, Francesc and Marta (2003) mention the contribution of marketing in the organization lies in the formulation of strategies to choose the right customer, build relationships of trust with them and create a competitive advantage. A marketing strategy consists of an internally integrated but externally focused set of choices about how the organization addresses its customers in the context of a competitive environment. A strategy has five elements: it deals with where the organization plans to be active; how it will get there; how it will succeed in the marketplace; what the speed and sequence of moves will be; and how the organization will obtain profits. This paper presents review of the literature on the product life cycle with discussion of the development of theories of the product life cycle and an analysis of the assumptions within the product life cycle. The paper also presents an application of the literature review to BMW in a concise and comprehensive way.

Literature Review on the Product Life Cycle with Discussion of the Development of Theories of the Product Life Cycle

Guido, Francesc and Marta (2003) mention to say that a product has a life cycle is to assert four things:

1. Products have a limited life.

2. Product sales pass through distinct stages, each posing different challenges, opportunities, and problems to the seller.

3. Profits rise and fall at different stages of the product life cycle.

4. Products require different marketing, financial, manufacturing, purchasing, and human resource strategies in each stage of their life cycle.

Figure 1: Bell-Shaped Product Life Cycle Curve

Figure 2: Common Product Life Cycle Curves

Most product life cycle (PLC) curves are portrayed as bell-shaped (Figure 1). Such curves are typically divided into four stages: introduction, growth, maturity, and decline.

1. Introduction: A period of slow sales growth as the product is introduced in the market. Profits are nonexistent in this stage because of the heavy expenses incurred with product introduction (Guido, Francesc and Marta, 2003).

2. Growth: A period of rapid market acceptance and substantial profit improvement.

3. Maturity: A period of a slowdown in sales growth because the product has achieved acceptance by most potential buyers. Profits stabilize or decline because of increased competition.

4. Decline: The period when sales show a downward drift and profits erode.

The PLC concept can be used to analyze a product category (medical devices), a product form (signal managers), a product (pacemaker), or a brand (Medtronics).

* Product categories have the longest life cycles. Many product categories stay in the mature stage indefinitely and grow only at the population growth rate. Some major product categories, such as typewriters, seem to have entered the decline stage of the ...