The Product Life Cycle

Product Life Cycle

Generally, there are four stages in a product’s life cycle: i) Introduction- the product is introduced, slow sales, no profits at this stage; ii) Growth- rapid market acceptance and substantial profit improvement; iii) Maturity- slowdown in sales growth because of widespread acceptance, stabilization/decline in     profits and; iv) Decline- downward drift in sales, erosion of profits. A sample PLC curve is shown above

Here, the PLC shall be explained in terms of a category (hair care), a product (shampoo) and a brand (Tresemme).

         

       1. Hair care as a category is constantly in a maturity stage for a very long period of time.  Consumers constantly buy newer and more advanced forms of hair care products as they move forward in life- factors such as age, lifestyle, income, gender, socio-economic strata play a crucial role in determining which kind of hair care product one uses. Eg: A rural household might use Parachute/Navratna/traditional mustard oil for massaging the scalp and Nyle/Superia/Clinic Plus as a shampoo, while an urban; SEC A household prefers Dove Elixir/Parachute Advansed as hair oil and an L’Oreal/Tresemme for shampooing. Some brands, however, are facing decline in their respective life cycles. Examples: Nyle

      2. Shampoo as a product is also in the same phase of maturity as the overall hair care category. It is also continuously experiencing growth as newer variants of shampoos for every class are available and are being developed.

      3. Tresemme as a brand has recently been launched in India. So, being a relatively newer player in the shampoo category, it is on the growth phase. It has already become a Rs. 1 billion brand in terms of the sales turnover.

Tresemme is launched by HUL in the premium range shampoos category.  The price of the shampoo is as follows:
8 ml – Rs. 3
100 ml – Rs. 68
200 ml – Rs. 135
600 ml – Rs. 315

The name Tresemme resonates professional quality and that is how they position themselves in the mind of the consumer. For this sole reason, they hired “Cocktail” fame Diana Penty and French hair expert and fashion circuit celebrity Marcus Francis (http://www.marcusfrancis.com/) as brand ambassadors for the shampoo.

The urban middle class and the high-end customers were apprehensive to buy it first but they then felt that it is a better deal than having to spend a few thousand rupees at a salon every month, when a shampoo can provide a similar benefit for under Rs. 500.

A large chunk of the product’s sales can be attributed to the very fact that Tresemme provides superior quality for the price that it comes.  Also, word-of-mouth and huge promotional campaigns (TVCs, PoP Displays, BTL advertising, PR campaigns etc) helped leverage the sales.

After that people started overlooking the price point and bought it for the salon-like experience it gives them.  Thereafter, high prices meant high quality.
In spite of entering the Indian market in 2012, Tresemme has already become the preferred choice of Indian women and has become one of the best international hair care brands in India. Increasing product depth (variants like smooth & shine, keratin smooth, split remedy and climate control), standing by its commitment to give a professionally styled look to the hair, a varied promotional mix and huge sales numbers are making it a truly aspirational and successful brand, which shall thrive even further.