An Empirical Investigation of Success Strategies for Businesses along the Product Life Cycle

Article Abstract:

Since the introduction of the concept of the product life cycle (PLC) some decades ago, a great deal has been written on the subject and several empirical studies have been conducted. However, empirical research to date is often limited in scope. It is oriented towards the analysis of the growth and saturation stages and focused primarily on the study of consumer goods. Furthermore, the application of the PLC concept in strategic planning is largely disappointing, the normative orientation of most of this literature being somewhat naive and misleading. The aim of the present research is to study the efficiency of different strategies for achieving market share and cash flow objectives. This study is performed on different types of businesses producing both consumer and industrial products situated at various stages on the product life cycle: growth, maturity and decline. A sample of approximately 1,100 businesses (217 in the growth stage, 315 in the maturity stage, 569 in the decline stage) is drawn from the PIMS data base. A cluster analysis is run to identify natural groups of homogeneous businesses. For each of the nine identified groups, linear regression models are estimated to study the influence of strategic actions - finance, marketings, production, R & D, personnel - on two criteria of performance: market share and cash flow. The research indicates that strategies not only depend on the life cycle stage but also are influenced by the goal orientation of the firm - short-term (cash-flow) or long-term (market share) - and that success strategies appear to be contingent upon the business and the environmental characteristics. (Reprinted by Permission of Publisher.)

Management science, Mathematical models, Strategic Planning, Study, Marketing Strategy, Criteria, Research Design, Product Life Cycle

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Competitive strategies for late entry into a market with a dominant brand

Article Abstract:

A model of asymmetric preferences is presented to demonstrate market positioning, advertising, and pricing strategies for organizations considering entering a market dominated by an established competitor. The model suggests that differentiated late-entry strategies can be made optimal by preference asymmetry, and that strategies involving the introduction of lower-priced versions of the dominant brand are not equilibrium late-entry strategies.

Product introduction, Brand name products, Brand names, Product differentiation

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An empirical investigation of success strategies for businesses along the product life cycle

Article Abstract:

The effectiveness of various strategies for generating cash flow and achieving market share goals is examined in relation to product life cycles. A sample of roughly 1,100 businesses is taken from the PIMS data base. Natural groups of homogeneous businesses can be identified by cluster analysis. Strategies will depend on the life cycle stages and on the goal orientation of the company.

Research, Analysis, Marketing management, Business planning, Strategic planning (Business), Business success

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