Unit 5: Product Life Cycle, Marketing Research, and Product Development
The product life cycle, an important strategic concept, varies according to the product or service offered, and determines the extent and frequency of new product offerings. Marketing research informs the firm about consumer needs and purchasing characteristics to guide marketing actions. Product development is key to the firm's sustainable marketing activities.
Completing this unit should take you approximately 5 hours.
Upon successful completion of this unit, you will be able to:
- explain the stages of the product life cycle;
- explain the importance and types of marketing research; and
- describe the importance and process of product development.
5.1: Product Life Cycle
Successful marketers understand the concept of the product life cycle. Products have a life span, as they are not expected to last forever. The challenge that marketers face is low long the product life cycle will be, and what form will it take?
Read this section to gain an understanding of the four stages of a product life cycle.
This video provides a clear explanation of the product life cycle.
Read this article on the application of the product life cycle. This incorporates the Boston Consulting Group Matrix, which characterizes the various stages in a product life cycle as "Question Mark", "Star", "Cash Cow" and "Dog".
Shorter product life cycles are more common today, than in prior years. Advances in technology and hyper competition have had the effect of faster entry into the marketplace for new products and new product models. This scholarly journal article addresses the shortening of the product life cycle within the automotive industry.
5.1.1: Variations in Product Life Cycle
The product life cycle is normally shown generically. However, not all product life cycles are the same in time or form.
For example, we can look at a simple product such as baking soda, which has been a product in the marketplace for well over 200 years. On the other hand, when we look at technological products such as computers, printers, smartphones, and tablets, the life cycle is often measured in weeks, as new products are coming out rapidly.
The following video describes the Technology Adoption Life Cycle, and how consumers differ in their willingness to purchase a new product. This is particularly important for companies that introduce products in the technology market sector; and it applies to new products as well as product enhancements.
5.2: Marketing Research
Marketing research is an important aspect of marketing. The goal of marketing is to identify consumer needs and satisfy those needs through the firm's offerings. How do we identify consumer needs? Does our product satisfy consumers' needs? What target markets are we attempting to reach with our offerings? These are questions that can be answered through marketing research.
Marketers must consider "the self-reference criterion" when creating marketable offerings. As a simple example, a marketing manager may personally like the color navy blue, and therefore decides to offer his product in this color because she likes it. Does this satisfy consumer needs? Perhaps, but the point is we need to determine whether the color navy blue is attractive to the consumers in the target market.
Read this section concerning Marketing Information Systems. Students should gain an understanding of the various means used to gather marketing information. Successful marketing is based on successful information gathering.
5.2.1: The Marketing Research Process
Research is a process, and marketing research is no exception. Marketers must be informed by marketing research in order to make informed marketing decisions. It is important to recognize that the purpose of conducting marketing research is to define problems or opportunities and develop answers to the research questions for the purpose of decision making. Research without decision making is a waste of the firm's resources.
Read these sections concerning the marketing research process. Note the 7-step process of marketing research. Consider why defining the problem (or opportunity) is the most important part of the process. Marketers must spend the proper amount of time in the problem definition and developing the research question(s) in order to ensure that the firm's resources are used wisely.
5.2.2: Types of Marketing Research
Marketing research is done using several types of methods. Marketers determine the problem or opportunity, and researchers determine what research method(s) will best answer the research question(s). The time and cost factors of research, and the resources available to the firm will often determine what research methods will be the most cost effective.
This video explains the difference between qualitative research and quantitative research. She uses an example of a French bakery and shows the different options of research available to the owner.
This video is like the previous video, but it describes the differences between primary and secondary data, and the advantages and disadvantages of each. It is often common to begin marketing research by exploring the available secondary research resources first. Secondary data is generally less expensive, sometimes free, and it is easier to obtain. However, the marketer must decide whether secondary data answers the specific research questions of the marketer. Primary data collection, when required, often follows secondary data research when the information available in secondary data does not provide the specific information required by the marketer.
This video explains observational research. This type of research is useful in determining consumer buying behaviors and is often used when research survey methods are determined to be less reliable. Pay particular attention to the terms used, such as unconscious and conscious reporting, which can occur in survey research methods.
5.3: Product Development
Product development often occurs after the requisite marketing research has been completed and findings are reported. As we have seen in the previous section, products have a life cycle. Accordingly, marketers must be forward thinking and develop new products, or redevelop existing products, when their products approach the maturity and decline stages in the product life cycle.
Review this chapter on creating offerings, which you read in Unit 4. Note the term offering is used in place of the word product, as we also market services and information. This text is comprehensive, as it includes the various attributes of products, such as packaging, labeling, etc.
5.3.1: New Product Development
New product development is a rather risky undertaking and should normally be undertaken after conducting marketing research. Those companies who develop new products are referred to as "first movers", wherein they perceive a need for a new product and a potential target market for the product.
Often the "first movers" are later joined by the "followers" or "me too-ers" when the product is deemed to be successful. The followers incur less risk than the first movers and usually attempt to capitalize by improving on weaknesses of the new offering with their competitive offering.
This video of the founder of Crocs shoes explains the development of the concept of the shoe and the story behind it.
5.3.2: Product Redevelopment and Adaptation
Product redevelopment, often referred to as product modification, is the progression of changes made to improve products, usually by changing one or several product attributes. Most of us are familiar with software upgrades, where software developers make regular changes or upgrades to enhance product performance and/or add features to a product. So, the term product development usually includes redevelopment and modification of different types over a period through the product life cycle.
Product adaptation is similar; however, it typically involves a product modification for certain targeted markets. Product adaptation is more commonly applied to international marketing, where products must be adapted to the idiosyncratic buying behaviors of consumers in foreign markets. Changing the color of dish detergent for a foreign market is a simple example.
Furthermore, some product adaptation is necessary due to regulations in a foreign market that require mandatory product adaptation. For example, to sell automobiles in the United States, the automobiles must be equipped with mandatory safety features such as airbags and be fitted with catalytic converters for environmental concerns.
Sustainability is on the minds of consumers today. Companies that can adapt their products to be more sustainable and environmentally friendly generally find their products more attractive to consumers.
This video describes a new way of thinking in product development. By considering sustainability at the start of the product development process companies recognize that they are satisfying consumer needs for sustainable products that are friendly to the environment.
This scholarly article concerns the modification of a Korean food (Gochujang) to be adapted for the European market. This is a good example of marketing research applied to product adaptation for international markets. Note that the consumer preferences are determined prior to the introduction of this product.
Unit 5 Study Resources
This review video is an excellent way to review what you've learned so far and is presented by one of the professors who created the course.
Watch this as you work through the unit and prepare to take the final exam.
We also recommend that you review this Study Guide before taking the Unit 5 Assessment.
Unit 5 Assessment
- Receive a grade
Take this assessment to see how well you understood this unit.
- This assessment does not count towards your grade. It is just for practice!
- You will see the correct answers when you submit your answers. Use this to help you study for the final exam!
- You can take this assessment as many times as you want, whenever you want.