Industry profits decline during the market maturity stage due to:
A) declining sales.
B) declining sales and declining costs.
C) mismanaged budgets.
D) rising promotion costs and increased competitive pressure to offer product at lowest prices.
E) new varieties of the original product that fail to meet customer needs.

Question

Quizplus · Accepted Answer

During the market maturity stage, competitive pressure increases, leading to rising promotion costs and the need to offer the product at the lowest prices. As a result, industry profits decline. Additionally, sales may begin to decline, but this is not always the primary cause of the profit decline. Mismanaged budgets and new product varieties that fail to meet customer needs may contribute to declining profits, but these factors are not as significant as increased competitive pressure and rising promotion costs.

Industry Profits Decline During the Market Maturity Stage Due To