Addition of product
Deletion of product
Product deletion is the process through which a product or an entire product line is removed from the product portfolio either through product elimination or product replacement. Usually, product deletion is done when a product reaches the decline or death stage of the product life cycle or there is a dramatic decline in its sales and profits. A failing product reduces the profitability of the firm and results in draining of resources. This process of product deletion requires the company to evaluate its entire product mix and analyze where can the resourced be used to generate more reliable revenue streams.
Along with declining sales, there are several factors which contribute to product deletion including the firm’s business model, failure of alignment with marketing strategies, local preference and culture, political and government rules and regulations, legal constraints and product malfunction. Product deletion or product elimination is a complex process. It involves communication with customers, proper production planning, evaluation of contracts etc.
Product Deletion Stages
Product deletion has four distinct stages:
- Identification of products to be deleted
- Analysis of products to be deleted.
- The decision to remove the product
- Implementation of the deletion process
Importance of Product Deletion
If a product is not at a proper position in the market and not generating enough revenue, then all the resources invested in it are washed out which could have been used for the production of some other product or enhance some existing product. This calls for product deletion. Sometimes, there is a presence of a lot of products in the product line which leads to increased use of capital and resources being distributed too thinly. In these cases, the deletion of some products is essential. A weak product demands more managerial efforts with respect to different marketing decisions and may also lead to debilitation of the company’s image and dissatisfaction of its shareholders. As the taste and preference of consumers change, there arises a need of deleting some products which no longer appeal to the new preferences. The old products can be totally eliminated by product deletion or replaced with some other new products. Sometimes, products which do not align with the current objectives of the company face deletion. Sometimes, when there are a lot of products in a product line, it leads to product cannibalism in which some products take away the business of some other products. It calls for product deletion of some products and thinning the product line depth.