Page 1

Product Life Cycle stages and AnsOff Matrix for Blackberry

Name Kashyap Shah

Batch & Section MBA 2014-2016, Section- C

PRN No 14020841136

Submitted to Prof. Semila Fernandes, Marketing Management

Page 2

Company Profile

Name: Research In Motion, BlackBerry

Industries served: Telecommunications equipment

Geographic areas served: Worldwide

BlackBerry smartphones: launched in 1999

Offices in: North America, Europe and Asia-Pacific

Headquarters: Waterloo, Ontario, Canada

Current CEO: John S. Chen

Revenue: $ 18.435 billion (2012)

Profit: $ 1.164 billion (2012)

Employees: 12,700 (2013)

Main Competitors: Apple Inc., Google Inc., Nokia OYJ, Samsung Electronics Co., Ltd.

NASDAQ Stock Market: NASDAQ: BBRY

Toronto Stock Exchange: TSX: BB

• BlackBerry Limited, formerly Research In Motion Limited, incorporated on March 7,

1984, is a designer, manufacturer and marketer of wireless solutions for the

worldwide mobile communications market.

• Company's primary revenue is generated by the BlackBerry wireless solution,

consists of smart phones and tablets, service and software. BlackBerry pioneered

Push Email services.

Page 3

Product Life Cycle

All product categories have a specific life span called the product life cycle. The product life cycle can pertain to unnamed products as well as those associated with a specific brand name. Many factors, such as competition and technology, affect brands and their product life cycle. Nevertheless, brands or products typically go through five stages of growth: development, introduction, growth, maturity and decline.

Development Stage Technically, the development stage is the "incubation stage" of a brand's product life cycle. The development stage is where the product concept is conceived, developed, branded and even tested before being introduced to the market. A lot of capital typically goes into the development stage, including product and advertising costs. It is certainly conceivable that a poor concept idea or the lack of capital could end the life of a brand before it is introduced. Introduction Stage Brands and their product life cycle actually commence in the public's eye during the introduction stage. During the introduction stage, companies heavily advertise their brands and products; and execute trade show and in-store promotions for potential wholesale and retail customers, respectively. Company advertising is mainly focused on building brand awareness. Companies usually price their brands relatively high during the introduction stage to recoup some of their development costs.

Page 4

Competition is low or non-existent during this stage. Thus, a successful brand concept will usually elicit heavy sales and propel the brand toward the growth stage. Growth Stage Brands enter the growth stage of the product life cycle when sales start growing exponentially. Brand managers may increase distribution during the growth stage to further enhance sales. A company may also improve the quality of their product brands, adding various flavors or features. Because of the success of one or more companies, more competitors will enter the market with their own brands. Consequently, some competitors may try to lower prices to gain marketing share. Maturity Stage Because of increased competition, a company's brands will eventually reach the maturity stage of the product life cycle. During this stage, competition for market share may be fierce. New competitors will often have trouble successfully entering the market as market potential is limited. A company will often need to differentiate the brand of products toward a specific segment. For example, the company that first entered the market may focus on being the quality leader. The company may keep prices relatively higher to maintain its premium image. The target market may include older users with a higher household income. Decline Stage The decline stage is where sales start to fall for a company's product brands. At this point, it is still possible to extend the life of the product by finding new markets for the brand like international markets; or even finding additional uses by repositioning the brand. For example, a small detergent manufacturer may extend the life of the brand by selling to emerging markets, such as India. The company could also potentially extend the life of the brand by marketing the detergent in car washes, hotels, schools and even hospitals. Ultimately, a brand may need to be sold or gradually discontinued if it is no longer profitable.

Page 5

Blackberry Product Life cycle stages:

In figure various products / phone devices of blackberry is shown according to their

current phase position in Product Life Cycle diagram (Based on sales values).

Other than Mobile device market, Blackberry’s tablet products are still in

somewhere between development and introduction stage.

Page 6

AnsOff Matrix

Page 7

Market penetration

Market penetration occurs when a company penetrates a market with its current

products. It is important to note that the market penetration strategy begins with

the existing customers of the organisation. This strategy is used by companies in

order to increase sales without drifting from the original product-market strategy.

Companies often penetrate markets in one of three ways: by gaining competitors

customers, improving the product quality or level of service, attracting non-users of

the products or convincing current customers to use more of the company's product,

with the use of marketing communications tools like advertising etc. This strategy is

important for businesses because retaining existing customers is cheaper than

attracting new ones, which is why companies like BMW and Toyota (Lynch, 2003),

and banks like HSBC engage in relationship marketing activities to retain their high

lifetime value customers.

From Blackberry’s perspective: Increase sales of Z and Q series phones among youth

and corporates, enhance after-sale customer experience by giving superior customer

services.

Product development

Another strategic option for an organisation is to develop new products. Product

development occurs when a company develops new products catering to the same

market. Note that product development refers to significant new product

developments and not minor changes in an existing product of the firm. The reasons

that justify the use of this strategy include one or more of the following: to utilise of

excess production capacity, counter competitive entry, maintain the company's

reputation as a product innovator, exploit new technology, and to protect overall

market share.

From Blackberry’s perspective: Re-innovate Blackberry device design, introduce

phones that are suitable for Android Platform.

Market development

When a company follows the market development strategy, it moves beyond its

immediate customer base towards attracting new customers for its existing

products. This strategy often involves the sale of existing products in new

international markets. This may entail exploration of new segments of a market, new

uses for the company's products and services, or new geographical areas in order to

entice new customers.

Page 8

From Blackberry’s perspective: Increase sales of Curve series phones by re-

introducing them in new and emerging markets.

Diversification

Diversification strategy is distinct in the sense that when a company diversifies, it

essentially moves out of its current products and markets into new areas. It is

important to note that diversification may be into related and unrelated areas.

Related diversification may be in the form of backward, forward, and horizontal

integration. Backward integration takes place when the company extends its

activities towards its inputs such as suppliers of raw materials etc. in the same

business. Forward integration differs from backward integration, in that the

company extends its activities towards its outputs such as distribution etc. in the

same business. Horizontal integration takes place when a company moves into

businesses that are related to its existing activities.

Therefore, diversification is a high-risk strategy as it involves taking a step into a

territory where the parameters are unknown to the company. The risks of

diversification can be minimised by moving into related markets.

From Blackberry’s perspective: Enter into tablets and Mobile App markets, launch

Blackberry apps for android / i-os phones, enter into consumer electronics items

such as Bluetooth devices, handsfree etc.

THE END