Basic Marketing: A Global Managerial Approach

Perreault−McCarthy: Basic

Marketing: A

Global−Managerial

Approach, 14/e

10. Product Management
    and New−Product
    Development

Text © The McGraw−Hill

Companies, 2002

286 Chapter 10

Do product modifications—like those made with powdered Tide—create a

wholly new product that should have its own product life cycle? Or are they

technical adjustments of the original product idea? We will take the latter

position—focusing on the product idea rather than changes in features. This means

that some of these Tide changes were made in the market maturity stage. But this

type of product improvement can help to extend the product life cycle.

On the other hand, a firm that develops an innovative new product may move

to a new product life cycle. For example, by 1985 new liquid detergents like Wisk

were moving into the growth stage, and sales of powdered detergents were declin-

ing. To share in the growth-stage profits for liquid detergents and to offset the loss

of customers from powdered Tide, Procter & Gamble introduced Liquid Tide. Then,

in 1997, P&G introduced Tide HE High Efficiency Laundry Detergent. It was the

first detergent designed specifically to work with a new type of washing machine

that is just now starting to appear in stores. These environmentally friendly front

loaders use up to 40 percent less water per wash and over 50 percent less electric-

ity than regular washers. Regular detergents don’t work in these washers because

they do too much sudsing, but Tide HE is designed to be a low-suds solution.

Although P&G used the familiar Tide brand name on both Liquid Tide and Tide

HE, they appear to be different product concepts that compete in different product-

markets. Traditional liquid detergent is probably now entering the market maturity

stage, and Tide HE is probably just starting the growth stage.

Even though regular powdered detergents in general appear to be in the decline

stage, traditional powdered Tide continues to sell well because it still does the job

for some consumers. But sales growth is likely to come from liquid detergents and

the new low-suds detergents.^13

We already highlighted the fact that the same product may be in different life

cycle stages in different markets. That means that a firm may have to pursue very

different strategies for a product, at the same time, in different markets.

In a mature market, a firm may be fighting to keep or increase its market share. But

if the firm finds a new use for the product, it may need to try to stimulate overall

demand. Du Pont’s Teflon fluorocarbon resin is a good example. It was developed more

than 50 years ago and has enjoyed sales growth as a nonstick coating for cookware, as

an insulation for aircraft wiring, and as a lining for chemically resistant equipment. But

marketing managers for Teflon are not waiting to be stuck with declining profits in

A new product idea gives birth to
lots of new products, so the idea
is important.

Develop new strategies
for different markets