Companies are continually trying to innovate new products to expand their sales and market share. This practice, however, comes at a price since selling a new product could mean losing sales of another product.

1. Explain how a company can balance the practice of cannibalization so they do not continually eliminate one product when a new product is introduced in the market. Use examples to demonstrate the positive and negative aspects of product cannibalization.
2. Since the stages of a product also influence the sales trends, explain how a company can use the product stage to their advantage if they understand the true position of the product in the market.