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ASSIGNMENT OF PRODUCT & BRAND MANAGEMENT ON PLC OF SAMSUNG MOBILE PHONES

DATED: 25-07-2012 SUBMITTED BY: RUPEN SUBMITTED TO: DR. ASHUTOSH KUMAR AMIT AJAY BHANDARI MITTALI AKANSHA

PRODUCT LIFE CYCLE

PRODUCT LIFE CYCLE

PLC in terms of Samsung mobile phones


1) Introduction Stage
a. Costs are high b. Slow sales volumes to start c. Low sales growth because of several reasons: i. Delays in expansion of production capacity ii. Delays in obtaining adequate distribution through retail outlets iii. Customer reluctance d. Profits are negative or low. e. Promotional expenditure at the highest. i. Inform potential customers ii. Induce trial purchase iii. Secure distribution in retail outlets. iv. Little or no competition - competitive manufacturers watch for acceptance/segment growth losses
f. Prices tend to be high because cost is high.

Eg. Samsung galaxy series of phone like S I its starting price is 16000/- and their sales volume is also low.

2)

Growth Stage
Rapid climb in sales. Early adopters like the product and new users start buying it. Competition begins to increase. They bring in new product features. Costs reduced due to economies of scale, so price remain where they are or fall slightly. Public awareness increases.

Companies keep their promotional expenditure as it is or slightly increase to meet competition. Sales rise much faster than promotional expenditure. Profits increase as promotional cost is spread over large volume and production increase. Eg. Samsung launched new models of Galaxy series like S I, S II and sales are rising.

3) Maturity Stage
a. Rate of sales growth slows down and product enters relative maturity. b. This stage normally lasts longer than the previous stages. c. This stage divides into three phases: i. Growth ii. Stable iii. Decaying Maturity Eg. Now Samsung galaxy S I, S II is on the maturity stage because of low sales growth

4) Decline Stage
a. Sales may decline for a number of reasons including:

i. Technological advances ii. Shifts in consumer taste iii. Increased domestic & foreign competition b. All leads to over capacity, increased price cutting and profit erosion. c. As sales and profits decline, some firms withdraw from the market. d. Those remaining may reduce the number of products they offer. Eg. Samsung Galaxy series S I, S II are now out of the market because there is a shift in the consumer taste and preferences and of technological advancement.

Strategies for PLC of Samsung Mobile Phone Division a) Growth


Firm may use several strategies to sustain the growth: a. Improve product quality and add new features. b. Add new models and variants (sizes, flavors) c. Enter new market segment. d. Increase distribution coverage and new channels. e. Shift from product awareness to product preference advertising. f. May lower prices to attract the next layer of price sensitive buyers. Eg. Samsung introduced Samsung Galaxy S III for its customers.

b) Maturity
Some companies may abandon weaker products and concentrate on more profitable products and new products. The basic strategies can be: a. Market Modification b. Product Modification c. Marketing mix modification Eg. As Samsung Galaxy series was liked by the customers Samsung started its Samsung modify the product and built Samsung galaxy tab.

c) Decline
Withdraw from market Reduce number of products offered Withdraw from smaller markets and weaker trade channels Considerably reduce promotional budgets Reduce prices further. Eg. Samsung must withdraw from the smaller smart phones segment and concentrate on more expensive smartphone segment.

http://www.marketingweek.co.uk/disciplines/advertising/samsun g-unveils-biggest-marketing-effort/4001523.article