Re-launching a product
A Heinz case study

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Page 4: Product life cycle

Heinz 6 Diagram 1An important marketing concept is that of product life cycle, sometimes referred to as simply PLC. All products go through a life cycle. Starting with the product first being introduced into a market, to the point when the product is removed from the market, it is said to go through various stages. These stages refer to its popularity and sales.

First, there is the introduction stage, followed by a stage when the product grows in sales. After this stage, the product reaches a point when its sales are at a maximum, and this is known as the mature phase. As time goes on, however, consumer patterns change and product sales begin to decline. At this point a manufacturer has to decide whether or not to let the product die (remove it from the market), or to invest in further promotion.

Heinz was faced with exactly this dilemma in respect of Salad Cream. It had been introduced in 1914 and enjoyed a growth phase up to the 1940s. For about 30 years, up to the 1970s, Salad Cream sales were in their mature phase. By the 1980s and 1990s sales and market position began to decline. In 2000, Heinz decided that rather than allow one of its most important products to die, it would invest in a new £10 million promotion campaign to reverse declining sales, and push Salad Cream back into its mature phase.

Heinz | Re-launching a product