Marketing Management

Global Edition
Kotler & Keller

Chapter 12

Addressing
Competition &

Driving Growth
 Chapter Questions

Why is it important for companies to grow the

core of their business?

What marketing strategies are appropriate at

each stage of the product life cycle?

How should marketers adjust their strategies and

tactics during slow economic growth?

1
Competition grows
more intense
every year
 Market
Market Members Leader

Market
Challenger

Market
Follower
Market
Nichers

3
 Product Life Cycle
• Products have a
limited life
• Sales pass through
stages
• Profits rise, then fall
• Different strategies
needed

4
 Sales and Profit

Life Cycles

5
 Common PLC Patterns:

Growth-Slump-Maturity

6
 Style, Fashion, and Fad

Life Cycles

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 Product Life-Cycle Stages

8
 Create awareness
Introduction Stage

Marketing Strategies: Induce product trial

Secure retail
distribution.

9
 Add new models
and flanker
Improve product
Growth Stage products (Diff.
quality; add new
sizes, flavors) to
features
protect the main
product

Focus advertising
on preferences &
Enter new market
Marketing Strategies: segments
loyalty (not
awareness and
trial)

Increase Lower price; Attract

distribution price-sensitive
coverage buyers

10
 Maturity Stage
Maximize
profit

Marketing Objectives:

Defend
market share

11
 Maturity Stage Market Modification

Product Modification
Changing Mature
Brand Course

Marketing Program
Modification

12
 Decline Stage
Rejuvenate

Harvest

Marketing
Strategies:

Divest

13
 Introduction Growth Maturity Decline

CHARACTERISTICS

Sales Low Rapidly rising Peak Declining

Costs/customer High Average Low Low

Profits Negative Rising High Declining

Customers Innovators Early Adopters Middle majority Laggards

Competitors Few Increasing Stable number Declining

Characteristics of the PLC

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 Introduction Growth Maturity Decline

MARKETING OBJECTIVES
Maximize
Awareness Maximize Milk the
profits; Defend
and trial market share brand
share
STRATEGIES
Extend;
Diversify brands Phase out
Product Basic Service,
and models the weak
warranty
Charge Price to
Price Price to match Cut price
cost-plus penetrate

Distribution Selective Intensive More intensive Go selective

Awareness Awareness Stress brand Reduce

Communications
early adopters mass market benefits to minimal

PLC Objectives and Strategies

15
 Marketing in an
Economic Downturn

• Invest
• Get close to
customers
• Review budgets
• Use a compelling
value proposition
• Fine-tune offerings

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