Commercial Applications
Assertion (A): The decline stage of the product life cycle is characterized by a decrease in sales and market share.
Reason (R): Companies should invest heavily in marketing and innovation during the decline stage to revive the product's growth.
- A is true but R is false
- A is false but R is true
- Both A and R are true and R explains A.
- Both A and R are true but R does not explain A.
Marketing Mix
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Answer
A is true but R is false
Reason — Assertion (A) is true because the decline stage is characterised by sharp fall in sales and market share due to displacement by superior products or change in consumer preferences. However, Reason (R) is false because during the decline stage, promotional expenditure has to be reduced drastically to minimise loss, and most firms shift their attention to other products rather than investing heavily.
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Related Questions
A company launches a new product in the market with the following conditions:
(i) The product is priced significantly higher than competitors.
(ii) The target market is affluent consumers who value exclusivity.
(iii) The product is heavily promoted as a luxury item.
Which pricing strategy is the company likely using?
- Penetration Pricing
- Cost-Plus Pricing
- Skimming Pricing
- Parity Pricing
Which stage of the product life cycle is most likely represented by the products in "D category" in the image below?
- Introduction
- Growth
- Maturity
- Decline
In which stage of product life cycle, the company takes decision whether to maintain, harvest or drop the product?
- Introduction
- Growth
- Maturity
- Decline
Which element of the marketing mix is most directly affected by the change illustrated in the image below?
- Product
- Promotion
- Place
- Price