Stages of Product Life-Cycle

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Product Life-Cycle:
Product life cycle
is a business analysis that attempts to identify a set of common stages in the life of commercial products. In other words the ‘Product Life cycle’ PLC is used to map the lifespan of the product such as the stages through which a product goes during its lifespan.

 

Product Life-Cycle Strategies:
The Product Life Cycle (PLC) has Five Stages

Product Development, Introduction, Growth, Maturity, Decline

Not all products follow this cycle: 

  •  Fads
  •  Styles
  •  Fashions

The product life cycle concept can be applied to a:

  • Product class (soft drinks)
  • Product form (diet colas)
  • Brand (Diet Dr. Pepper)

 Using the PLC to forecast brand performance or to develop marketing strategies is problematic.

 

PLC Stages

  1. Product development
  2. Introduction
  3. Growth
  4. Maturity
  5. Decline

Product development

  • Begins when the company develops a new-product idea
  • Sales are zero
  • Investment costs are high
  • Profits are negative

Introduction

  • Low sales
  • High cost per customer acquired
  • Negative profits
  • Innovators are targeted
  • Little competition

Grouth

  • Rapidly rising sales
  • Average cost per customer
  • Rising profits
  • Early adopters are targeted
  • Growing competition

Maturity

  • Sales peak
  • Low cost per customer
  • High profits
  • Middle majority are targeted
  • Competition begins to decline

Decline:

  • Declining sales
  • Low cost per customer
  • Declining profits
  • Laggards are targeted
  • Declining competition

 

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