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marketing strategy

By Frederick Reynolds,2014-06-13 19:31
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marketing strategy

Marketing Strategies on Maturity Stage

-- Of Home Appliance

    Abstract

    If forced to figure out what plays the most important role in the success of one‘s business, most people would indubitably blurt out that is the marketing strategy. Obviously, as the modern world has been paving its way to the marketing economy, the marketing strategy is taken for granted to be the access to the success of a company. Associated with the concept of product, marketing strategy is also engaged itself in the 4 phases of the PLC, namely, the introduction, the growth, the maturity, as well as the decline phase. Consequently, the application of the strategy in each stage of the PLC will enhance the revenue of a company undoubtedly.

    ……

    As the word-limitationthis thesis mainly covers the marketing strategy in the maturity

    stage, advancing itself via the illustration of the features and analysis of the product, as well as the measures taken to sustain the product growth in the maturity stage. Certain selected examples, such as the cases in Haier, Wal-mart, and P&G appear in this thesis, aiming to proof the theoretical part.

    Key Words

    marketing strategy; the maturity stage; marketing mix; core features; cautions and suggestions

     I

    摘要

    倘若让我们指出在一个企业的成功中什么起了决定性作用,大多数人会毫无疑问地回答说是营销策略。显然,伴随着当今世界把他的航程驶向市场经济时代的到来,市场营销策略已经理所应当地成为一个企业事业成功的关键。就产品概念而言,营销策略与其所射猎的四个不同的产品周期阶段有着紧密的联系。

    ……

    因此,不同策略在不同阶段的成功应用将大有利地推动企业的收益状况。由于论文字数的限制,以及专业性细方向的选材,故本文仅对成熟期的营销策略进行相关描述,并通过例证进行解析,望对有意者提供些许帮助。

    关键词

    营销策略; 成熟期; 营销组合; 主要特征; 注意事项及建议

     II

    Contents

Abstract ....................................................................................................................................... I

    摘要 .....................................................................................................................................................................II

Introduction………………………………………………………………………………………..1

    1 Introduction of the basic concepts ......................................................................................... 1

    1.1 Concerns with the marketing strategy ............................................................................. 1

    1.1.1 The definition of marketing strategy ..................................................................... 1

    1.1.2 The role of marketing strategy in business ............................................................ 2

    1.2 Concerns with the maturity stage ................................................................................... 2

    1.2.1 Introduction of product life cycle .......................................................................... 2

    1.2.2 Introduction of marketing mix ......................................................................................................2

    1.3 Features and analysis of the marketing strategies on maturity stage ................................ 2 2 Marketing strategy on the maturity stage ............................................................................... 3

    2.1 Product strategy ............................................................................................................. 3

    2.2 Distribution strategy ....................................................................................................... 7

    2.3. Pricing strategy ............................................................................................................. 9

    2.4 Promotion strategy ....................................................................................................... 10

    3 Some cautions and suggestions when conducting marketing strategies ................................ 12

    3.1 xxxxxxxxxxxxxxx……………………….…………………………………………….xx

    3.2 xxxxxxxxxxxxxxxxx…………………………………………………...………………...xx

     3.2.1 xxxxxxxxxxxxxxxxxxx……………………………………………………….……xx

     3.2.2 xxxxxxxxxxxxxxxxxxxxxxx……………………………………....……………….xx

     3.2.3 xxxxxxxxxxxxxxxxxxx……………………………………..……………………...xx

    Conclusion ............................................................................................................................... 13

    References ................................................................................................................................ 14

    Acknowledgements .................................................................................................................. 15

注(若文中用到四级标题,四级标题不出现在Contents中。

    Marketing Strategies on Maturity Stage Of Home Appliance

    Obviously, as the modern world has been paving its way to the marketing economy, the marketing strategy is taken for granted to be the access to the success of a company. Associated with the concept of product, marketing strategy is also engaged itself in the 4 phases of the PLC, namely, the introduction, the growth, the maturity, as well as the decline phase. Consequently, the application of the strategy in each stage of the PLC will enhance the revenue of a company undoubtedly. As the word-limitationthis thesis mainly covers the marketing strategy in the

    maturity stage, advancing itself via the illustration of the features and analysis of the product, as well as the measures taken to sustain the product growth in the maturity stage. Certain selected examples, such as the cases in Haier, Wal-mart, and P&G appear in this thesis, aiming to proof the theoretical part.

    ……

    By marketing strategy, it means the arrangements of marketing activities and the effective revenue among the procedures of the production, the promotion the distribution as well as the sales. To be more exact, it refers to a series of effective marketing actions to achieve the expected result. A marketing strategy is a characteristic of marketing; ―it is the scientific and tactful process of matching the company‘s resources to the wider environment to produce a statement,

    which summarize the overall route the firm will take to achieve its objectives. 1 Introduction of the basic concepts';

    For better comprehension and availability, we now need to introduce a great multitude of specific items and buzzwords. These items cover the field of marketing, and assist you to smooth

    [1] the reading of the thesis.

    1.1 Concerns with the marketing strategy

    Just as we mentioned above, marketing strategy plays a vital role in the success of one‘s business, yet what marketing strategy really defines might still puzzle certain people, so let us turn now to the definition of marketing strategy first.

    1.1.1 The definition of marketing strategy

    To comprehend the term marketing strategy, it is indeed necessary to digest the two separate constituents which combine to form the phrase, that is, marketing and strategy.

    What is marketing? Briefly speaking, marketing refers to the management process which identifies, anticipates and supplies customer requirements efficiently and profitably, and marketing can also be concerned with the nucleus of the business success.

    As for the word ‗strategy‘, it originates from military, meaning the art of planning movements of armies or forces in war. With the development of linguistics, strategy has now become a common term, used in every aspect of work and life, as we can see from ―communication strategy‖, ―job-hunting strategy‖, ―trading strategy‖, and ―marketing strategy‖. From the semantic perspective, strategy refers to principles and approaches in relation to the changing situations, and the art of planning, of using existing means. To sum up, strategy can

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    Marketing Strategies on Maturity Stage Of Home Appliance

    refer to tact, technique and art.

    1.1.2 The role of marketing strategy in business

    Indubitably, the marketing strategy is paid to fairly high attention while people conduct their business. The vital triumph of a business is at times connected to its marvelous marketing techniques. Therefore, people, the businessmen in particular, heighten the role of the marketing strategies with constant effort. It is worthy of dedicating much to the research and calculate the strategies of extravagance use, in order to avoid the failure resulting in the careless and rash decision.

    1.2 Concerns with the maturity stage

    Getting contact with the definition of the maturity stage comes after understanding the concept of PLC; therefore we should first engage ourselves in the comprehension of PLC. 1.2.1 Introduction of product life cycle

    To give the barest definition, it refers to 4 parts: the introduction phase, the growth phase, the maturity phase, as well as the decline phase.

    As the thesis merely focuses on the marketing strategies on the maturity stage, therefore, it is just willing to concentrate on the terminology of the maturity stage, and omit the others for convenience.

    Maturity stage refers to the stage in the product life cycle in which sales growth slows and

     [2] levels off.

    1.2.2 Introduction of marketing mix

    Marketing mix is the set of controllable tactical marketing toolsproduct, price, place,

    and promotionthat the firm blends to produce the response it wants in the target market. It can be collected into four groups of variables known as the "4Ps": product, price, place, and promotion.

    Product means the goods and services combination, which can help the customer to solve their actual problem. Price is the amount of money customers have to pay to obtain the product. The company can set price as their own pricing strategies. Place includes company activities that make the product available to target consumers. In order to get more proceeds, a company should select a good place full of profitable customers who have purchasing power. Promotion means activities that communicate the merits of the product and persuade target customers to buy it. Company may as well advertise on the public media.

    1.3 Features and analysis of the marketing strategies on maturity stage

    Turning now to the aspect of features and analysis of the marketing strategies on maturity stage is due to better extending the thesis, for to draft out the marketing strategies calls for to

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    Marketing Strategies on Maturity Stage Of Home Appliance

    grasp the traits of the maturity stage first:

    Briefly speaking, we can segment the features of maturity stage into 4 parts, i.e.:

    (1) It normally lasts a longer time-scope than its previous phases;

    (2) It usually poses stronger challenges to its marketing management;

    (3) It gradually slows down its sales growth resulting in many produces with many products to sell.

    (4) It obviously confronts greater competition due to the slowdown of the sales growth.

    ……

    1.3.1 Core features of the marketing strategy

    For the maturity stage, the core feature of the marketing strategy is that, the strategy or plan we make should firmly adhere to the principle of maintaining the market share. The aim is to consolidate and protect the market share. Only now can profits be taken from the product offer. These fund new product offers and provide a profit contribution. Consequently, all decisions should be made to maintain the product offer in the minds of the target audience

    keeping the product up-to-date. Notice how the detergent manufacturers keep their product offers alive by new ways to communicate the same basic message. The major brands have been in their maturity stage for many years, but still deliver the same basic function. They help to wash clothes.

    Take Haier as a specific example, the robust firm has been running for years to diversify its product categories, from the list of fridges in the earliest time, to the nowadays mobile phone and computer hardware, and the firm indeed succeeds in smoothing and extending its market share. However, though the firm has already fruited in revenue, it still spends the majority of funds on the investigation and research of the fridge rather than other items. The aim, beyond any doubt, is to make full use of its paramount products and maintain their marketing demands, Haier‘s market share.

    2 Marketing strategy on the maturity stage

    In the last part, we have already, from macro aspect, covered core features of the marketing strategy on maturity stage. Subsequently, to illustrate this part, we tend to digest it from more segmented elements, namely, to associate it with the analysis of 4Ps in this phase. 2.1 Product strategy

    Product strategy is the core of strategic planning for the enterprise and it plays pivotal strategic decisions about the products to be offered are among the most important of those affecting the future of a company. No other strategic decision has such widespread impact, cutting across every functional area and affecting all levels of an organization. This key strategic role should not come as a surprise since meeting people‘s needs and wants with goods and services is what business is all about. Consequently, to grasp the essence of product

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    Marketing Strategies on Maturity Stage Of Home Appliance

    strategy comes as an important factor, in the circumstances that one is willing to balance its product market. Then what is a product strategy? The book, Strategic Marketing coined by David. V. Cravens, defines the product strategy in the following items:

    A product strategy consists of:

    1) Deciding how to position a business unit‘s product offering (specific product, line, or mix) to serve its target market.

    2) Setting strategic objectives for the product offering.

    3) Selecting a branding strategy.

    4) Developing and implementing a management strategy for new and existing products.

    As the thesis focuses merely on the product strategy on maturity stage, so the strategic components included here mainly cover the last two, namely, selecting a branding strategy, developing and implementing a management strategy for new and existing products.

    Turning now to the aspect of selecting a branding strategy, management in a manufacturing firm has several alternatives in conducting so. These include:

    1) Using the reputation and support of marketing intermediaries to convey brand reputation. For example, a product is good because of its subsidiary post of P&G.

    2) Manufacturing products for other firms with their private brands affixed to the products. For example, Nestle supplies milk powder to KFC.

    3) Building brand identity by applying the corporate name to the entire mix (a strategy used by Deere and Co., International Harvester, and several other manufacturers).

    4) Establishing brand names for lines of products such as Haier and Pepsi Cola brands.

    5) Using brand names for specific products such as Wal-mart, Chesebrough-Pond‘s

    Vaseline, Ragu, Cutex, and Q-tips brands. Brand names may be used to designate different offerings within a line (e.g., clothing) and for different product categories.

    A firm may choose to use more than one of the above branding strategies such as private branding for others in combination with the firm‘s own brand.

    ……

    Although on maturity stage, new products are still the center of the attention in most companies because of their obvious contribution to the survival and prosperity of the enterprise. Planning for the new products is an essential and demanding strategic activity. New products, when matched to customer needs, offer opportunities for strengthening position in existing product markets and a means to move into new product markets. Yet we are still reluctant to take the step into introducing a new product, for compared with managing the existing products, developing a new one costs too much perspiration. The reason why we are involved in this strategy is just because it still makes sense, provided that we cannot skillfully sustain the

     [3]existing products.

    We turn now to an examination of what is involved in managing existing products,

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    Marketing Strategies on Maturity Stage Of Home Appliance

    concerning with the existing products, we mainly offer the two strategies:

    1) Battling against losses in marketing share: Here, we quote an instance from the robust firm Haier again to illustrate it.

    A standard product that Haier sells through distributors started to lose market share. A detailed analysis determined that Haier‘s prices exceeded those of the competition, and that the

    benefits to the customer did not warrant the higher price. To correct the situation, Haier required a complete redesign of the product and a new manufacturing area specifically to mass produce it.

    Since the objective of the company was to be the dominant producer in the market, all the corrective steps were taken. Today, Haier is one of the dominant producers and the firm has competitive prices that offer the customer more features than any of its competitors.

    In another market area, association statistics again showed Haier was rapidly losing market share. A more detailed analysis showed that machines based on a different engineering concept that Haier‘s products were rapidly replacing the type of machine Haier was building for this market segment.

    A plan for corrective action was pulled together. The firm would have to design a new machine from the ground up, but then the plan was rejected because the cost was high. This market was not considered to be one of major importance to the corporation, and the moneys required for the redesign were needed in other, more important areas.

    Haier‘s market share continued to slide downward while alternative solutions to the

    problem were being reviewed. In the meantime, a small manufacturer had entered the field because of technical know-how gained in a different industry…Subsequently it became

    apparent to him that he had underestimated the cost of entering the market, and that this was a drain on the capital he needed to remain dominant in his normal markets. Haier was able to acquire the rights to his newly engineered product and thus regain our lost market share.

    Meanwhile, Haier‘s competitors continued to improve their machines to match the

    performance of theirs. However, Haier failed to allocate sufficient engineering and design funds to remain competitive. In time, Haier started to lose market share and, once again, it had a product in trouble. Analysis showed that it had to improve its product and provide competitive features.

    ……

    At that point, Haier had an extreme drain on its engineering groups to provide innovative features and technical steps forward for product lines more important 4o the well-being of the company. A search was therefore undertaken to locate a foreign manufacturer who did not participate in its market, and who had a machine of proven design that would be applicable to its market. A company was found and a licensing agreement made. Initially, foreign machines were imported while Haier‘s production facilities were being converted to making the

    machines. Unfortunately, neither the imported machines nor those made at Haiers facilities

    were able to withstand the operating conditions in its market, and its market share continued to slide.

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    Marketing Strategies on Maturity Stage Of Home Appliance

    The remaining alternatives were either to redesign its own machines, or to get out of the business. The decision was made to cancel the licensing agreement, and Haier is now in the process of redesigning its machines to meet the needs of the market.

    From Haier‘s case, people may conclude the tips pf battling against the market share loss: conduct a thorough and complete research concerning with the reason why market share loss could happen, and do not miss any possibilities. After prescribing the issues, try utmost to cure the barriers on the condition of protecting the maximums revenue and sometimes, to quit does not mean to fail.

    2) Product improvement can be handled in several ways. Some firms wait until a problem develops which calls for improving the product. Others schedule improvements each year, every two years, or some other regular interval. Product improvement strategies that anticipate problems and opportunities are, in many instances, more effective than simply responding to problems. And, unless there is no competition, product improvement is essential to maintaining and improving market position. Similarly, cost improvement should be a continuing concern of management. Lower costs of producing and distributing products will enable greater profit contributions and/ or price reductions.

    Ever since Procter Gamble(PG) introduced the first commercially successful

    disposable diaper over 35years ago, PG and Kimberly-Clark(K-C) have been slugging it out

    for the lion‘s share of the approximately4 billion marker. With brand names like Pampers,

    Luvs, and Huggies, PG and K-C have pursued value-added strategies arguing that their brands fit better, are more absorbent, or control leakage better than the other brands. Although PG developed innovative diapers like Extra Absorbent Daytime, Improved Newborn, or Quilted Pampers, in the early 1990s, it found itself trailing K-C in the super-premium segment-C,S Huggies Supremes dominated that segment. As a result, C had the dominant overall market share. A host of smaller competitors, led by Drypers, pursued value-pricing strategies to target more price-sensitive consumers.

    By 1997, however, even the companies using the value-price strategy offered fit, absorbency, and leakage-control features similar to PG,s and K-C,s products. Moreover, the

    disposable diaper market flattened due to price competition and population growth of only 1 percent per year. Consumer concern over the environmental impact of disposable diapers and other products had also slowed market growth. However, some studies that used a technique called ―life cycle assessment‖ concluded that although disposable diapers generated four times as much solid waste as reusable, they utilized only about half the energy and one-fourth as much water and caused haft the air pollution. Given these factors, the competition for market share intensified.

    As the two lions shouldered with each other, so how to step forward one more pace came to the two firms‘ most crucial schedule. Then, Drypers opened a new front in the diaper wars. It introduced several varieties of diapers that used aloe vela to soothe the baby‘s skin and baking soda to control odor. Drypers, innovation introduced skin care as the next big thing in disposable, PG confirmed that Drypers was onto something when, just three months later, it introduced Pampers Gentle Touch diapers.

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