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Concept Of Product Life Cycle In Marketing

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Product Life Cycle

Have you ever seen your parents’ old VHS tapes or your brother’s CD collection and wondered why they had them when everything is just a click away? Each of these cases is an example of the product life cycle.

Every time a product hits the market, it goes through a life cycle that takes it from young and useful to old and retired. Most products eventually become obsolete, but no one wants that for their product. It is important to understand what stage your product is at for better marketing and strategy.

In this article, we will discuss the product lifecycle, including its stages, how it works, and examples. We will also see how it differs from the BCG matrix.

The product life cycle (PLC) is the process by which a product is developed, brought to market, and finally retired. Generally, the product life cycle has five stages: development, introduction, growth, maturity, and decline.

What Is The Product Life Cycle? Stages And Examples

The concept of a product life cycle was introduced in 1965 by a German economist, Theodore Levitt. He worked at the famous Harvard Business School and published his product life cycle model in an article in the Harvard Business Review (1). He pointed out that while the product life cycle is a widely known concept, it is hardly used tactically. In his article — exploiting the product lifecycle he said:

“The concept of a product life cycle is today at about the same stage as the Copernican view of the universe of 300 years ago: many people knew about it, but almost no one seemed to know about it. ‘to use effectively or productively.’

The development phase of the product life cycle is the starting point of the product journey. Even before the product hits the market and generates revenue, companies spend a huge amount of money on market research and product development strategy.

Product development begins with refining the concept, testing the product, and designing a launch strategy. Product concept testing at this stage can help you know the consumer’s reaction to the product and get first-hand feedback.

Product Life Cycle And Marketing Strategies

Companies bring in investors, develop prototypes, test the product’s effectiveness and develop a launch strategy. The goal is to develop a prototype or product sketch to show to investors and potential customers.

The duration of the development phase may vary depending on the complexity of the product. For a new product, this stage usually takes longer, because it is more difficult to launch a product than to improve new iterations.

The introduction phase of a product corresponds to its first launch on a market. This is a critical period in a product’s life cycle, but the success of your product doesn’t entirely depend on it.

During this stage, the marketing team focuses on creating awareness about the product in order to reach the target audience. Most companies spend considerable amounts of money promoting their products. When you first launch a product, the stakes and costs are high as you try to find a place in the market.

Product Life Cycle

An example of promoting a product before its launch is Apple’s famous launch presentation, which has remained a staple of its brand for over 20 years. The keynote announces and highlights new features of their newly launched (or soon to be launched) products. After the initial launch, you can use inbound marketing and content marketing to further promote the product.

The duration of the introduction phase depends on various factors such as customer needs, product competition, complexity of the product and novelty of the product idea. Launching a new product is generally more difficult than innovating an old product, which is why many new products fail at the launch stage. However, with a good idea and execution, you can launch a new product with confidence.

The growth phase of a product begins when the product has made its mark in the market and consumers have adopted it. Sales usually increase and the business begins to generate revenue. The demand for the product and profits is increasing at a constant rate and more and more competitors are entering the market.

Marketing at this stage is as critical as the introduction stage. However, it will be more about establishing a brand identity and increasing the product’s market share than trying to attract customer attention. The goal is to show customers why they should choose your brand over your competitors.

Product Life Cycle Stages For Strategic Success

The next important element of growth is expansion. This includes adding new features to your product/service, improving support, and opening new distribution channels. Since competitors will also enter the market with a similar or improved product, you need to maintain the quality while refining the product.

The fourth stage of the product life cycle is maturity. This is the moment when the product reaches its peak – the climax of the automaton. Even if your growth is not rapid, production costs will likely decrease and sales will stabilize.

During the maturity stage, market saturation may occur and you will run out of growth opportunities. Competitors may have captured part of the market and many consumers are using their product rather than yours. The challenge now is to maintain the product’s position in the market over time and take certain steps to avoid any significant setbacks.

Now that the product has matured, you might be tempted to sit back and relax, but money never sleeps, and nor should you. None of the famous brands got to where they are by sitting still.

Applying Business Analysis Principles To Product Life Cycle

Take the example of Coca-Cola. Even if they don’t depend on marketing, they don’t leave the media. They know that brands are not forever and, no matter how popular they are with consumers, they are always subject to changes in consumer behavior and market instabilities.

At this stage, marketing efforts primarily focus on showcasing the individuality of the product rather than raising awareness. If you don’t keep up, you’ll likely enter the decline phase of the product life cycle.

When a mature product loses customer interest and its sales begin to decline, it enters the decline phase of the product life cycle. Not all products necessarily face a decline phase. Businesses can stay afloat by having multiple products at different stages of their lifecycle. Typically, product sales decline in the face of increasing competition and eventually lead to product decline.

Although market decline is often inevitable, there is still much you can do to remedy it. For example, when you see a decline, your marketing team can promote nostalgia around the product to emphasize its superiority over competitors. You can also abandon the product, innovate with the product, or sell the company that owns the product.

Pdf] Integrated Marketing Communications At Different Stages Of The Product Life Cycle In The Context Of Brand Management

Coca-Cola requires no introduction. It is one of the most popular drinks in the world. Let’s take a look at the Coca-Cola product life cycle and how it went through the different stages of the product life cycle.

The typewriter was the ancestor of keyboards still known for the mechanical sound produced by its keys. Although a worthy successor to pen and paper, the typewriter was eventually replaced by other technologies.

Before the era of CDs and DVDs, floppy disks were used to store and share data between computers.

If you’re a kid from the ’90s (or older), you probably remember the days when you had to change TV channels to find something to watch. Although cable TV may seem archaic compared to Netflix and Hulu, many people still use it.

Product Life Cycle Management

Global warming and climate change are no longer the issues of tomorrow, and electric vehicles are a way to bring change. Although electric vehicles are generally more expensive than gasoline cars, they also leave a smaller carbon footprint. (3)

The product life cycle and the BCG matrix are similar concepts but relate to different aspects of a product’s performance. (2) The BCG matrix lists market share and market growth to see the impact of a certain product on usage and cash generation. The product life cycle uses sales/revenue and profitability over time.

Named after the initials of the Boston Consulting Group, the BCG Matrix AKA, Growth Share Matrix, consists of four stages: Question Mark, Star, Cash Cow, and Dog.

Question marks are products that do not yet have a market but have great growth potential. Stars are flagship products that generate substantial revenue. Cash cows are the future of stars, that is, products that have matured and are entering a decline phase. Finally, dogs are the problem products that don’t sell well (or generate revenue) and are unlikely to recover.

Business Hand Drawing Product Life Cycle Chart Marketing Concept Stock Photo, Picture And Royalty Free Image. Image 16248068

Simply put, question marks and stars are products that have growth potential and require marketing investment. Cash cows are on the verge of becoming obsolete and you should not invest money in them. Dogs will not recover from this, even with a significant investment.

Marketers use the product life cycle to personalize their marketing efforts at each stage by conducting market research. Managers use

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