2. Strategic Development Product Life Cycle (Revisited in ‘Product’) Bowman’s Competitive Strategy Options New Product Development (NPD)

4. Five stages of the PLC Product development - sales are zero, investment costs are high Introduction - profits do not exist, heavy expense of product introduction Growth - rapid market acceptance and increasing profits Maturity - slowdown in sales growth. Profits level-off. Increase outlay to compete

5. Decline - sales fall-off and profits drop

6. PLC exercise The Ford Escort The Mini Cooper The Internet Phone Cadbury’s Fuse The Boeing 747 The Millennium Dome KIT KAT

7. Source: Based on the work of Cliff Bowman. See C.Bowman and D.Faulkner. Competitive and Corporate Strategy, Irwin, 1996. Bowman’s Strategy Clock

8. 1 Low price/low added valueLikely to be segment specific 2 Low priceRisk of price war and low margins/need to be cost leader 3 HybridLow cost base and reinvestment in low price and differentiation 4 Differentiation (a) Without price premiumPerceived added value by user, yielding market share benefits (b) With price premiumPerceived added value sufficient to bear price premium The Strategy Clock: Bowman’s Competitive Strategy Options

9. 5 Focused differentiationPerceived added value to a particular segment, warranting price premium 6 Increased price/standard Higher margins if competitors do not value follow/risk of losing market share 7 Increased price/low value Only feasible in monopoly situation 8 Low value/standard price Loss of market share

10. New- Product Development Process New product strategy Idea generation Idea screening Concept development and testing Marketing strategy Business analysis Product development Test Marketing Commercialisation