ComicalYou is a new social media service in which participants create avatars to represent themselves, describe their lives, and interact with one another. All the postings are graphical, presenting the messages in the form of comic panels and strips. The service's software easily converts ideas into whimsical images. The site's creators, Ginny and RJ, believe that ComicalYou will be especially appealing to young people because it is so effective in conveying emotional content with a lighthearted appeal. They, along with a team of six employees, have completed the software, tested it on two dozen of their closest friends, and are eager to open up their site to users. Ginny and RJ are correct: ComicalYou becomes a hit with young people, even with a $5 per month subscription fee. Within two years, it becomes the number one online destination for people in their teens and twenties, and usage soars. An online social network introduces a comics creation tool to compete with ComicalYou for 10 cents per message. What marketing strategy is most appropriate for this stage of the product life cycle?
A) Reintroduce the product in new markets to avoid the decline stage.
B) Reduce or end promotional support because people already know about ComicalYou.
C) Focus on making customers aware of the product and its benefits.
D) Lower prices slightly and continue promotional expenditures to keep demand growing.
E) Develop product adaptations to extend the product's life.

Question

Quizplus · Accepted Answer

Since a competitor has entered the market, the best strategy at this stage of the product life cycle is to lower prices slightly and continue promotional expenditures to keep demand growing. This will help to maintain the product's market share and attract new customers.

ComicalYou Is a New Social Media Service in Which Participants