Essay About Mature Stage And Product Category

Cigarettes In The Product Life Cycle
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Cigarettes as a “product category” are in the mature stage of the product life
cycle. When referring to the product category, I am referring to the marketing territory
in which a particular manufacturers product competes. For example, Marlboro, Camel,
and Winston compete in the cigarette product category. Most products we see every day
reside in the mature stage of the product life cycle. Marketers of cigarettes in the
mature stage use both advertising and sales promotion as a means to compete for market
share within the product category. Marketers focus on both preventing the loss
of market share to competitors and gaining market share from those same competitors. In
this stage, marketing does not serve to recruit new product category users, but rather to
allocate already existing users to brands within the category. All products in the mature
stage of the product life cycle experience entry of new consumers and exit of existing
consumers for reasons unrelated to company marketing activities.
American values are fundamental factors that shape much of the advertising in the
United States. Like companies in other industries, cigarette manufacturers often bring
into play American Values based on cultural norms that appeal to consumers. Cigarette
advertising images have broad appeal to adults, rather than having any distinctive appeal
to adolescents. In addition, cigarette manufacturers use of image advertising is
consistent with the marketing of other products in the mature category and is targeted to
existing users of the product category.
There are significant and critical differences between advertising and price
promotions. While companies utilize mass media advertising to compete on the qualities
and characteristics of their particular brand of cigarettes, the use of price promotions
represents a fundamentally different marketing objective one specifically focused on and
limited to setting the brands price. This strictly price based competition reaches only
those consumers who are already making purchases in the product category. In this
manner, price promotions are clearly linked to competition within a mature product
category, where competing cigarette manufacturers try to compete for consumers who are
part of a limited target audience. Price promotions may appear to cost more than
advertising, but the two cannot be compared easily because the cost of a price promotion
is dependent on the level at which the full retail price is set and the number of units sold
at the promotional price.
In the mature stage, sales in the overall product category may increase for a while,
but then level, becoming flat over time. Competition within the category becomes very
intense and the market leaders, which are Phillip Morris, Altria Group, BAT, and R J
Reynolds (“The Big Four”), survive while more marginal manufacturers drop out of the
market. Advertising at this stage is not concerned with educating the consumer, but
fighting for market share among consumers that already know what the product is for and
have chosen to enter the product category. “Advertising becomes less
informative and almost entirely image based as manufacturers protect and constantly
reinforce the equity of their brand. As distinguished from primary demand stimulation,
which takes place at the introductory stage, advertising in