PRODUCT LIFE CYCLE !

Hello Everyone and welcome back to my blog. Today we are going to be talking about the product life cycle and what it encompass. This process contains four important stages; beginning with the introduction stage, growth stage, maturity stage and lastly the decline stage. I am going to go into depth in each of these four sections to inform you all of what happens in each stage. 

PRODUCT LIFE CYCLE DEFINITION: The stages a product goes through in the marketplace. 

INTRODUCTION STAGE:  The introduction stage of the product life cycle happens when a new product is introduced to the predetermined target market. 

WHAT HAPPENS DURING THIS STAGE?

• Slow sales growth

• Minimal profit ( Due to minimal profit in this stage many companies like to invest in research and development activities)

• Large amount of money spent on advertising and promoting 
• The main goal of this stage is to increase awareness of the product so advertising is the best way for companies to do so

EXAMPLE: Gillette Razors. When this company was in the process of producing their Fusion razor they cut themselves out 200 million dollars for advertising to be able to introduce this product successfully to the market.

• Gaining distribution 

• Pricing can be high or low 
• A high price can be used as a skimming strategy 
• A low price can be used as a penetration pricing strategy. 

There are many different products that are in the introduction stage; a great example would be hybrid cars; there are not too too many of them in the market; they are just getting introduced and trying to find their place. 

GROWTH STAGE:  The growth stage of the product life cycle is when there is a rapid increase in sales. This is the stage where other companies have to watch out for the competitors because this is the stage where they are going to come in to play. 

WHAT HAPPENS DURING THIS STAGE?

• Competition appears;

• Increased product sales due to new people trying the product along with repeat customers 

• Changes appear to help differentiate a company's brand from that of the competitors 
• an improved version or new features are added to the original design 

EXAMPLE: The fax machine was big in the 1900's. The fax machine was released into the market just as any other product was and there were changes made to it.

• models with built in telephones 
• models using different kinds of paper 
• models that incorporated electronic mail (E-mail)

• During this stage it is important to broaden your distribution for the product. 

When looking at this stage as a whole; I refer to it as the trial and error stage; the company has created a product but they want to make it the best it can be for the customer so they are going to make as many changes as possible to enable to product to be successful in the market. A great example of a product in the growth stage is smart phones. smartphone companies are always coming out with new products; I Phone for example; we are not up to I Phone 6 and 6 plus; the company keeps changing their product to make it better for the consumer. 

MATURITY STAGE; This stage is characterized by a slowing of total industry sales or product class revenue.

WHAT HAPPENS DURING THIS STAGE?

• Marginal competitors begin to leave the market 

• Sales increase at a decreasing rate because there are less buyers entering the market 

• profit declines; because of price competition between many sellers and the cost of gaining new buyers at this stage increases. 

Overall this can be a hard stage more many companies. The first couple of stages are easy for companies they are able to develop their product and then grow their product but this stage is different; the company is trying to maintain their market share.This can be hard when thinking about all of the different aspects that are involved and also all the competition that companies have to deal with as well. 

There is an up side to this stage though; they have the ability to differentiate their product from other companies with the same product. If they are able to do this then they are going to be the top in the market and they are going to be one step ahead of the rest. 

           

DECLINE STAGE:The decline stage occurs when the sales of a company drop. 

WHAT HAPPENS DURING THIS STAGE?

• A product enters this stage not because there is something wrong with the actual product or because there is something wrong with the business strategy but because of the changes that occur in the environmental change. 

Lets look at an example: 

• Digital music players such as I Pods and MP 3 players pushed compact discs out of existence; the same as E-mail did too fax machine. 

There are many products that are in this stage of the product life cycle; it is just a way of business; there are two different ways that companies can handle the declining product stage. 

DELETION: This stage is deleting or dropping the product from the company product line all together. This strategy is the most drastic measure that the company can take when they are in the deletion stage. 

HARVESTING: This is yet another strategy that a company can pick when in the decline stage; this stage is when the company retains the product but reduces the costs associated with marketing. This is different then the deletion stage because the company continues to be offer the product. Overall the purpose of this stage is to maintain the ability to meet requests of the customers. 

This completes the four stages that a product goes through; the product life cycle of a product. Not all products go through the whole cycle and some products stay in one cycle for a long period of time. It all depends on the company and what product the company is trying to sell to the customers. 

There are also a few other aspects that come into play when talking about the product life cycle... those being 

FOUR ASPECTS OF THE PRODUCT LIFE CYCLE: 

• Length of the product life cycle :
• There is no set length of time it take a product to make its way through the product life cycle. 
• Shape of the product life cycle 
• The product life cycle curves are all different depending on the type of product. 
• High learning products: one that requires extensive customer education
• Low Learning product: one that does not require much learning from the customer
• Fashion Product: Depends on the style at the time. 
• Fad product: Experiences raid sales in the introduction stage then begin to decline. This is mostly products with short life cycles.

• The product level: class and form 
• Product Class:  refers to the entire product category of the industry as a whole; such as the prerecorded music industry
• Product Form: This is the varieties within the product class.Such as CD's cassette tapes I Pods and MP 3 players

• The life cycle and consumers. This stage all depends on the sales to customers. The shape of the graph of the life cycle is going to mimic the sales of that product. 

This concludes the whole product Life cycle. There are many steps that have to take place for a product to be successful in going through this process but many products have been successful in doing so. There are a slim few that are stuck in one stage or another but that just means that the company has to work that much harder to make their product what the consumer is looking for. 

I have attached a short video that can help you to further understand the product life cycle!

Thank you once again for reading,

Until next time,


Alexis Combs