Product Strategy and Product Life Cycle

The development of a product strategy is one of the most important components of introducing new products into the market. A product strategy is defined as a roadmap that provides an outline of the end goal of a product and what it would become upon completion. Business organizations increasingly develop and utilize product strategies because of their significance in strategic planning and marketing with regards to the achievement of desired organizational goals and objectives. The formulation of a product strategy is also critical because products and services usually undergo a life cycle of new product introduction, growth, maturity and decline. The different stages in new product introduction have considerable impacts on the marketing strategy and promotional initiatives. An example of a product strategy is the introduction of a new software product in the market.

Marcu & Gherman (2010) define product life cycle as the period between the product appearance on the market and its disappearance from circulation. Consequently, the product life cycle is a reflection of the evolving stages of a product over its lifetime. When creating a product strategy, it's important to consider the various stages of the product life cycle because sales and profits of a product undergoes significant changes during the product's lifetime. For this software product, the product strategy incorporates the various elements of product life cycle because the product has a limited life and is likely to undergo distinct stages. The other aspects to be considered for this software product strategy and its life cycle include the variations in sales and profits across different phases of the product's lifetime and the need for different strategies in every stage of the product's life cycle.

The introduction of this software product into the market will incorporate market development stage, which involves creating demand for the product before its launch. Levitt (2010) contends that market development stage helps in ensuring that new production introduction customer-oriented in order to avoid pitfalls and increase the chances of the product's success. The market development initiatives for this software product will entail identifying the information system needs of organizations and individuals. These needs will be utilized as the critical factors for the creation of a market for the software product. In this case, individual and corporate clients for this software product will be identified based on their information system needs. The software will then be marketed based on its capabilities to meet the identified information system needs of individual and corporate clients.

The second aspect of the introduction of this product is the growth phase given that one of the expected trends in the launch of this software is gradual rise in the sales and profit curve during market development. Levitt (2010) states that the market development stage is usually characterized by an increase in consumer demands, which in turn contributes to the rise in sales and profits. For this software product, an increase in sales is expected during market development as more individual and corporate clients purchase the software because of its capabilities to meet their needs. Since competitors are likely to take note of the performance of this product and develop strategies to counter the product, new distribution channels and retail outlets will be established to reach more customers and increase consumer acceptance rates.

The third aspect of the launch of this software is market maturity, which is a by-product of market saturation. As the company establishes new distribution channels and retail outlets for the software, more individual and corporate clients are likely to own or use the product because of increased accessibility of the product. At the same time, competitive attempts such as cheaper alternative software products are likely to emerge in the market as rivals adopt measures to counter the success and profitability of this software. These factors in turn contribute to market saturation, which will also be characterized by intense price competition. As a result, the company will focus on holding its distribution and retail outlets while attempting to secure intensive distribution. In this regard, the marketing initiatives for this software product will focus on holding on to the existing customer base and reaching out to more customers. The process will also be geared towards enhancing the company's ability to compete more effectively with other rivals in the market.