CLEP Marketing

Answer: B - Blue Navy has studied the company’s swimwear sales in a number of states in the Northeast and determined that setting prices to “liquidate” levels is the most prudent course of action. The swimwear lines in these states are most likely in the decline stage of a product lifecycle. During the decline stage of a product lifecycle, a company aims its marketing and promotions strategy to reinforce loyal customers and reduce overall promotions and advertising costs. As part of this strategy, the company sets prices at a much lower rate to liquidate inventory and make space for emerging products. During this stage, a company may also be very selective in product distribution and eliminate low-selling outlets.