Conclusion

This study compares the fit and prediction performance of the simple logistic, Gompertz, and the time-varying extended logistic models for 22 electronic products, proposes a decision process for selecting forecasting models, and demonstrates a case study to predict the future trajectory of RFID industry using the proposed procedure.

Since the simple logistic and Gompertz curves require the correct upper limit settings for accurate market growth rate predictions, these two models may not be suitable for short product lifecycles with limited data. Therefore, to solve this problem, the time-varying extended logistic model was tested. Since the time-varying extended logistic model estimates the time-varying capacity from the data, it tends to perform better for both long and short lifecycle products if the data are not linear. The results show that the time-varying extended logistic model statistically significant outperforms the simple logistic and the Gompertz models in most of product datasets where the data has the beginnings of an S-shape.

A decision diagram is proposed after comparing the three models to help select a suitable forecasting model among the three models. Although the time-varying extended logistic model has better prediction performance, its advantage of having more parameters is also a limitation for it. Since the time-varying extended logistic model have more parameters to capture the dynamic upper limit, it sometimes will produce non-convergence results. For avoiding this problem, this research recommends that there should be at least fifteen data points in the database for applying the time-varying extended logistic model. However, if a non-convergence result happened using the time-varying extended logistic model but the point of inflection of the curve has

occurred, then the simple logistic or Gompertz models can be alternative forecasting models. The simple logistic model is a symmetric model about its point of inflection and this means the upper limit will be twice the volume occurring at the inflection point.

For the Gompertz model, although it is an asymmetric model, the point of inflection occurs at 37.79% of the upper limit and the upper limit can then be calculated when the inflection point is found. Therefore, if the inflection point has occurred, then the simple logistic model and the Gompertz model can be used to forecast. Moreover, if a forecaster perceives there will be a larger market potential, the Gompertz model may be a suitable alternative forecasting model. Thus, a forecaster needs to master the market situation to select a suitable prediction tool. This research also presents a case study of China RFID patent analysis to demonstrate the process of applying forecasting models.

The forecasting results show that the China RFID patent applications will reach an upper limit of 1734 in the year 2020. A subarea, RFID frequency and waves, has the most potential for future development rather than other subareas and the results has been confirmed with industrial experts. Therefore, the forecasting process proposed by this research has the validity.

In product lifecycle management, different strategies need to be deployed to adapt different lifecycle stages. This research recommends several strategies which can be applied in PLC management based on the works of Chen, Liu, and Tzeng (2000) and Kotler, Keller, Ang, Leong, and Tan (2006). Table 16 generated and tablets the marketing, R&D, innovation, and patent strategies of different product lifecycle stages.

Take the RFID case study as an example. From the previous forecasts results, the whole China RFID industry is current in the mature lifecycle stage. However, the RFID industry can be classified into six subareas and different subareas have different development trajectories. Most subareas are in mature stage while wireless

communication device (cluster 2) is in saturation stage. Therefore, the strategies for mature and saturation stages should be different. In mature stage, the basic characteristic is a peak growth. Sixty eight percent of the customers, called majority, adopt the product or technology in this stage. The competition is fiercer and the development of the product or technologies is mature, therefore, the marketing objective in maturity stage is to maximize profit while defending market share. Thus, to provide distinguished product form other competitors, RFID manufacturers need to diversify their products which can satisfy different potential customers’ demand, stress brand difference and benefits, set the price to match or beat competitors’, and build more intensive distribution. Moreover, a customer-orientated R&D strategy is needed to improve or design a RFID product or technology which can attract more customers.

Therefore, marketers and researchers can apply quality function deployment (QFD) method, a customer-centric market research method, to investigate the product features that the potential customers like. Besides, since customers will put more emphasis on the quality, RFID manufacturers should stable and standardize their products by improving their production process and robust design. In maturity stage, the existing manufacturers have developed and owned many patents related to the products, so if new functions or designs will be added on the product or technology, patent search is strongly recommended before production. Patent licensing then may be needed when offending other inventor’s intelligence property.

As for saturation stage, its characteristic is that the growth begins to slow down and decline. Laggards which count for 16% of the customers are used to describe the adopters in this stage for their late to adopt the product or technology. The market is stable and strong brands appear, so there are no fierce competitions in this stage. Some new products or technologies will replace the existing ones, so the marketing objective

for those companies in the subarea of wireless communication device is to reduce marketing expenditure and milk the brand. Therefore, weak items and models must be phased out, the promotions have to be reduced to the level needed to loyal customers, cut the retail price, and eliminate the unprofitable distribution points to lower the operation cost. In addition, a price-orientated R&D strategy is appropriate. Since there will be new substitutions for this product or technology, the leading manufacturers need to sell their stock items with lower price. For those producers with no strong brand, they can only provide additional functions with much lower price to survive in the market.

Thus, the function combinations or alternative materials or technologies are useful innovations strategy in maturity stage. Patent strategy is focus on the development of new designs or accessories.