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

Four Stages Of The Product Life Cycle

Every time a product enters the market, it has 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 in which stage your product is for better marketing and strategic.

What Is The Product Development Life Cycle? A 2023 Guide

In this article, we will discuss the product life cycle, including its stages, how it works and its 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, enters the market and is finally removed. Generally, there are five stages in the product life cycle – development, launch, growth, maturity and decline.

The concept of the 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 product life cycle is a widely known concept, it has hardly been used tactically. In his article – Exploiting the Product Lifecycle, he said:

“The concept of the product life cycle is at about the stage today that the Copernican view of the universe was 300 years ago: many people knew about it, but no one seems to be using it in any effective or productive way.”

Product Life Cycle And Its Strategies

The development phase of the product life cycle is where the product journey begins. Before the product even hits the market and generates revenue, companies spend a tremendous amount of money on market research and a product development strategy.

Product development begins with refining the concept, product testing 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.

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

The length of the development stage can vary depending on the complexity of the product. For a new product, this stage is usually longer as pioneering a product is more difficult than improving further iterations.

Reading: Stages Of The Product Life Cycle

The launch stage of a product is when it is first introduced into a market. This is a critical time in the product life cycle, but your product’s success does not entirely depend on it.

During this stage, the marketing team is focused on creating awareness about the product to reach the target audience. Most companies spend a large amount of capital on product promotion. When you first launch a product, the stakes and costs are both high as you try to make your way into the market.

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

The length of the launch stage depends on various factors such as customer needs, product competition, product complexity and the novelty of the product idea. Launching a new product is generally more difficult than innovating on an old product, which is why many new products fail in the introductory stage. Although, with a great idea and proper execution, you can confidently launch a new product.

Solved Question 29 In The Table Below, Identify The Four

The growth stage of a product begins when the product has made its place in the market and consumers have embraced it. Sales generally increase and the business begins to generate income. The demand for the product and profit is growing at a steady pace and more and more competitors are entering the market.

Marketing at this stage is just as critical as the launch stage. However, it will be more focused on establishing a brand identity and increasing the product’s market share than trying to attract customers’ attention. The focus is on showing customers why they should choose your brand over the competition.

The next important part 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 must maintain quality while refining the product.

The fourth stage of the product life cycle is maturity. This is when the product is at its peak – the highest point during the PLC. Although you may not grow rapidly, production costs will likely decrease and sales will stabilize.

Product Life Cycle Management Plm

During the maturity stage, market saturation may occur and you will no longer have growth opportunities. Competitors may have taken a share of the market and many consumers are using their product instead of yours. The challenge now is to maintain the product’s market position over time and take certain measures to avoid any significant setbacks.

Now that the product is mature, you may be tempted to sit back and relax, but money never sleeps, and neither should you. None of the famous brands got where they are by sitting back.

Take the example of Coca-Cola. Even though they are not dependent on marketing, they are not leaving the media. They know that brands don’t last forever and no matter how popular you are with consumers, you are always subject to consumer behavior changes and market instability.

Marketing efforts at this stage are mainly focused on highlighting product individuality instead of creating awareness. If you don’t keep up, you will likely enter the decline stage of the product life cycle.

Business And Marketing Concepts, 4 Stage Of Product Life Cycle Diagram Stock Vector Image & Art

When a mature product loses customer interest and its sales begin to drift downward, it has entered the decline stage of the product life cycle. Not all products necessarily face a decline stage. Companies can stay afloat by having multiple products at different points in the product life cycle. Generally, product sales decline in the face of increasing competition and ultimately lead to product decline.

Even though the market decline is often inevitable, there is still a lot you can do about it. For example, when you notice the decline, your marketing team can nurture nostalgia around the product to emphasize its superiority over the competition. You can also discontinue the product, innovate the product, or sell the company that owns the product.

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

The typewriter was the grandfather of keyboards still known for the mechanical sound its keys used to make. Despite being a worthy successor to pen and paper, the typewriter was eventually replaced by other technologies

What Is A Product Life Cycle? (definition And Examples)

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

If you’re a ’90s kid (or older), you probably remember the days when you had to change TV channels to find something to watch. While cable TV may seem like something archaic before Netflix and Hulu, there are still many who still use it.

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

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

Business And Marketing Concepts, 4 Stage Of Product Life Cycle Chart. Royalty Free Svg, Cliparts, Vectors, And Stock Illustration. Image 68631141

Named after the initials of the Boston Consulting Group, the BCG matrix AKA growth stock matrix contains four phases – 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 top products that generate significant revenue. Cash cows are the future of stars, i.e. products that are mature and entering the decline stage. Finally, dogs are the problem products that do not sell well (or generate revenue) and are unlikely to recover.

To put it simply, question marks and stars are products that have the potential to grow and demand marketing investment. Cash cows are close to obsolescence and you should not invest money in them. Dogs will not recover, even with significant investment.

Marketers use the product life cycle to adjust their marketing efforts for each stage by conducting market research. Managers use the product life cycle to make decisions about price, packaging, design, market expansion, etc. to strategize. If you want to use the product life cycle, start by doing thorough market research and then move to development.

Understanding The 4 Stages Of The Product Life Cycle

To begin your journey with the product lifecycle, Starlight Analytics

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