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What is the growth stage of a product explain its properties?
The Growth stage is the second of stages in the product life cycle, and for many manufacturers this is the key stage for establishing a product’s position in a market, increasing sales, and improving profit margins. This is achieved by the continued development of consumer demand through the use of marketing and promotional activity, combined with the reduction of manufacturing costs. How soon a product moves from the Introduction stage to the Growth stage, and how rapidly sales increase, can vary quite a lot from one market to another.
Benefits of the Growth Stage
Costs are reduced: With new product development and marketing, the Introduction stage is usually the most costly phase of a product’s life cycle. In contrast, the Growth stage can be the most profitable part of the whole cycle for a manufacturer. As production increases to meet demand, manufacturers are able to reduce their costs through economies of scale, and established routes to market will also become a lot more efficient.
Greater Consumer Awareness: During the Growth phase more and more consumers will become aware of the new product. This means that the size of the market will start to increase and there will be a greater demand for the product; all of which leads to the relatively sharp increase in sales that is characteristic of the Growth stage.
Increase in Profits: With lower costs and a significant increase in sales, most manufacturers will see an increase in profits during the Growth stage, both in terms of the overall amount of profit they make and the profit margin on each product they sell.
Macro environment factors 5?
The company and all of the other actors operate in a larger macro environment of forces that
shape opportunities and pose threats to the company. There are six major forces (outlined below)
in the company’s macro environment. There are six major forces (outlined below) in the
company’s macro environment.
Macro Environment Factors
• Demographic forces: Different market segments are typically impacted by common demographic forces, including country/region; age; ethnicity; education level; household lifestyle; cultural characteristics and movements.
• Economic factors: The economic environment can impact both the organization’s production and the consumer’s decision making process.
• Natural/physical forces: The Earth’s renewal of its natural resources such as forests, agricultural products, marine products, etc. must be taken into account. There are also the natural non-renewable resources such as oil, coal, minerals, etc. that may also impact the organization’s production.
• Technological factors: The skills and knowledge applied to the production, and the technology and materials needed for production of products and services can also impact the smooth running of the business and must be considered.
• Political and legal forces: Sound marketing decisions should always take into account political and/or legal developments relating to the organization and its markets.
• Social and cultural forces: The impact the products and services your organizations brings to market have on society must be considered. Any elements of the production process or any products/services that are harmful to society should be eliminated to show your organization is taking social responsibility. A recent example of this is the environment and how many sectors are being forced to review their products and services in order to become more environmentally friendly.
Microeconomics is the study of individuals, households and firms' behavior in decision making and allocation of resources. Definition: Microeconomics is the study of individuals, households and firms' behavior in decision making and allocation of resources.
Enlist major types of segmenting a consumer market. Explain any one type in detail.
The goal of market segmentation is to separate the general market into categories, which can then be targeted and marketed to most effectively. There are four general types of market segmentation:
1. Geographic segmentation separates a market into different geographical boundaries which can impact the marketing mix of product, price, promotion and channel to market. For instance, you may not sell many down comforters in Arizona, but the market in Michigan is pretty good. Ever been to Hawaii? The price of goods is substantially higher than the continental United States. And the way you promote and sell a product in southern California will be quite different from Vermont.
2. Demographic segmentation separates a market by demographic indicators including gender, age, household type, education level and income. Simply put, the type of products we buy, how much we spend, and how we buy them are largely determined by demographic factors.
3. Psychographic segmentation separates a market by lifestyle as well as values and beliefs. There are large target markets which fit psychographic segmentation, such as outdoor recreation and fitness.
4. Behavioral segmentation separates a market by shopping and buying behaviors. Are you an online shopper or do you prefer to handle products in the store? How often do you shop? Do you research a purchase carefully before making a decision, or do you tend to buy on impulse? All of these factors determine how consumers are segmented and marketed to.
If you’re a critical thinker like me, you may be wondering about those people who fall in between, or are made up of a combination of, those segments. My experience on Pandora is a great example. Am I the Chevy or Mercedes demographic? Although market segmentation isn’t a perfect science, it will certainly get you closer to understanding your target audience and increasing your marketing return on investment.
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