GROWTH STAGE:

The growth stage is marked by a rapid climb in the sale. The early adopters like the product, and the middle majority consumers start buying the product. New competitors enter the market, attracted by the opportunities for large scale production and profit. They introduce new product features and this move further expands the market. The increased number of distribution outlets leads to an increase in the number to fill the distribution pipeline.

Price remains where they are or fall insofar as demand is increasing quite rapidly. Companies maintain their promotional expenditure at the same or at a slightly increased level to meet competition and to continue to educate the market.

Profits increase during this stage as promotion costs are spread over a larger volume and unit manufacturing costs fall faster than declines owing to the experience curve effect.