Product life cycle – extension strategies
Extension strategies
Developing new products is expensive and takes time, so businesses will usually try to extend the life cycle of a product and prevent it from going into decline. To do this, they need to find ways of keeping people interested in the product for longer, thereby increasing the number of sales.
An extension strategy is usually introduced between the maturity and saturation stages of the product life cycle, before a real decline takes place. The aim is to continue to maintain a steady rate of revenue from a product.
Ways of extending the life cycle of a product
There are a number of ways that a business can extend the life cycle of a product:
- Making a product stand out from its competitors. – this means making a product stand out from its Another producer who sells similar products., usually by highlighting the differences between it and the other products. Ensuring that a product has a The distinctive factors that make a product or brand stand out from rivals. is a good way to differentiate it from other products.
- Reducing the price of the product - by the time a product has reached maturity, it may face Competition exists when there is more than one business trying to compete for the same customers in a market. from other products. When this happens, the business may no longer be able to charge such a high price for the product. If the price is reduced, existing customers are likely to continue buying it, while other customers may switch from competing products.
- Rebranding the product – tired-looking branding and packaging can put customers off. Refreshing the brand and packaging design can appeal to new customers and convince previous customers to try a product again.
- Repositioning the product - this extension strategy involves exploring new markets for a product. It is possible to revive a product by testing new uses for it or adding value so that it appeals to a different audience. For example, a business could try introducing a different sized version of the product.
- Increasing marketing activity - running new The method by which goods or services are promoted to their potential consumer base. campaigns and sales promotions can attract new customers, remind previous customers that the product still exists and encourage existing customers to buy more of the product.