Product Lifecycle and Smartphone

RIM Addressing Product Lifecycle Challenges at Research in Motion (RIM) RIM, currently known as BlackBerry Limited, was one time the most valuable company in Canada and the largest smartphone manufacturer worldwide (Friend, 2013). Today, however, the company struggles to remain in existence, with revenues, subscribers, and profitability declining consistently since 2013. The fall of RIM can largely be attributed to poor product lifecycle management. This paper describes this problem in more detail and providers recommendations for addressing the problem.

Product life cycle theory demonstrates that a product generally goes through four stages: introduction, growth, maturity, and decline (Gorchels, 2006). The first stage, introduction, involves launching the product to the market. At this stage, there is little or no competition, giving the company an important competitive advantage in the marketplace. Nonetheless, costs tend to be high as the company has to develop the market for the product. High costs often mean little or no profitability. At the second stage, growth is experienced.

Sales increase rapidly, costs reduce due to economies of scale advantages, profitability increases, greater awareness of the product in the market is achieved, and market share expands substantially. Nonetheless, competition increases, potentially resulting in reduced prices. The third stage, maturity, is characterised by further reduction in costs, market saturation (sales peak is attained), increased competition, reduced prices, and decreased profitability potential. Once saturation is reached, growth starts to decline. In the decline stage, sales volume reduces and profitability diminishes.

Every stage of the product lifecycle has important implications for marketing (Cant et al., 2006). In other words, the marketing mix must be adjusted accordingly at every stage. In the introduction stage, the focus of marketing is to develop product awareness as well as build the market for the product. This may be achieved through product branding, establishing product quality, obtaining intellectual property rights, penetrative pricing, selective distribution, and targeting promotional activities at early adopters.

In the growth stage, the focus of marketing shifts to growing market share and building brand preference. The firm adds more innovative features to the product, adds distribution channels, maintains prices, and targets promotional activities at a larger audience. In the maturity stage, the aim of marketing is to protect market share. This may be achieved by differentiating the product from competition, lowering price, intensifying distribution, providing purchase incentives, and emphasising product differentiation in promotional messages.

In the last stage, the firm has three options: retain the product by adding new features, minimise costs and focus on a niche market, or discontinue the product (Gorchels, 2006). Business Problem Founded in 1984, RIM experienced tremendous growth in the first two decades and a half or so of its existence. During that period, the company made remarkable innovations in wireless and mobile communications, introducing the first two-way communication pager in 1996 and the first smartphone in 2000 (Friend, 2013).

For the telecommunications industry, RIM was the game changer, significantly revolutionising the way human beings communicate. At the time of its peak in September 2012, RIM had approximately 80 million subscribers globally, with revenues in excess of $19 billion. The BlackBerry was at the time the most preferred smartphone worldwide, a major achievement for the company in terms of building brand preference. From late 2012, however, RIM's glory started diminishing, in large part due to the increased competitive strength of Apple Inc. and other smartphone manufacturers (Arthur, 2014).

In the last four years, the company has consistently recorded a stark decline in revenues, profitability, and subscriber numbers. Even with extensive strategic and leadership changes, restructuring, and change of name from RIM to BlackBerry Limited in recent years, the company is yet to regain is previous glory. One of the major reasons for RIM's decline is the failure to innovate and respond to the changing needs of consumers.

Noticing RIM's shortcomings, Apple and Android vendors introduced more superior smartphones to the market -- devices with larger touchscreen displays, faster processing speed, more appealing designs, more applications, a better user experience, and so forth (Savov, 2016). While RIM's devices had an unparalleled reputation for security and functionality, the company ignored opportunities to make its products better, giving its rivals a perfect chance to knock it out of the market. At its maturity stage, the company had a chance to rethink its product strategy, particularly in the wake of increased competition.

Nevertheless, choosing to retain its focus on the corporate consumer, the company did little or nothing to differentiate its products or respond to the evolving needs of the individual consumer (Silcoff, McNish & Ladurantaye, 2013). As a result, it became more and more difficult for the company to reverse its decline, eventually discontinuing most of its hardware products. Had the company handled its product lifecycle differently, perhaps it would still be the king of the global smartphone market.

Current Marketing Strategy In the last few years, RIM has been shifting its focus to the enterprise market. The company now desires to design, develop, and market hardware and software products for industrial use. Indeed, most of the company's products are now targeted at government agencies and business organisations. In other words, the company's present products are not designed with the everyday user in mind. This, in large part, explains why captivating BlackBerry commercials are now quite rare.

Even so, there still exists a small niche of individual consumers loyal to the BlackBerry brand. Recommended Marketing Strategy Whereas RIM's success in the smartphone market has been overtaken by Apple and Android vendors such as Samsung, there is hope for a comeback. By revamping its marketing mix, the company can return back to its former splendour. BlackBerry devices still maintain an unbeatable reputation for security, making them the preferred choice for organisations and high-profile individuals. This is a particularly important strength in today's cyber environment.

With the exception of the iPhone, most smartphones in the market lack strong security features, making them easy targets for cyber-attacks. Whereas BlackBerry devices have robust security features, security is not the only thing the modern consumer wants. The modern consumer also wants a smartphone that supports more applications and with bigger touchscreen displays, more functionalities, and a more appealing design. Also, consumers want more varieties. This is another area where RIM failed.

Competitors like Apple and Samsung offer numerous varieties of smartphones in terms of design, colour, size, storage size, price, and other smartphone features. This enables the rivals to meet the diverse needs of the market. The first thing the company should do is to redefine its product strategy. By producing devices with more consumer-oriented features and more varieties, the company can take advantage of its historical reputation to regain competitive advantage in the fiercely competitive smartphone marketplace.

The company's smartphone would not just be the typical smartphone, but a more secure smartphone, thereby differentiating it from the competition. More consumer-oriented devices mean that the company would target not only enterprise users, but also the everyday consumer. To effectively target the individual consumer, the company must have competitive pricing and promotional strategies. With the iPhone mainly targeting high-end consumers, RIM can take advantage of this gap by offering its devices at a lower price.

This may be particularly helpful in emerging markets such as China, India, and Latin America, where majority of the consumers cannot afford high-end smartphones. By offering its products at a lower price, the company would be in a better position to create market share (Cant et al., 2006). Further, the company can attract customers by using more attractive discounts, offers, after-sale services, and warranty terms. Specific Strategic Action Recommendations To implement the above strategy, the company would have to undertake a number of actions.

First, the company must commit more efforts and resources to research and development (R&D). This would be vital for understanding the modern smartphone consumer, and thereby designing devices.