Product Life – Cycle The course of a products sales and profits over its lifetime. It involves five distinct stages.
After launching the new product, management wants the product to enjoy a long and happy life. Although it does not expect the product to sell forever, the company wants to earn a decent profit to cover all effort and risk that went into launching it, Management is aware that each Product will have a life cycle, although the exact shape and length is not known in advance.
01. Product development :-
Begins when the company finds and develops a new product idea . During product development, sales are zero and the company’s investment costs mount.
02. Introduction Stage :-
The introduction stage starts when the new products in first launched. In which the new product is first distributed and made available for purchase.
In this stage as compared to other stages profits are negative or low because of the low sales and high distribution and promotion expenses. Much money is needed to attract distributors and built their inventors.
03. Growth Stage :-
The product life cycle stage in which a product’s sales start climbing quickly.
If the new product satisfied the market, it will enter a growth stage, in which sales will start climbing quickly. The early adopters will continue to buy and later buyers will start following their lead, especially if they hear favourable word of mouth
04. Maturity Stage :-
The stage in the product life cycle in which sales growth slows or levels off.
At some point, a products sales growth will slow down, and the product will enter a maturity stage. This maturity stage normally lasts longer them the previous stages, and it possess strong challenges to marketing management. Most products are in the maturity stage of the life cycle. And therefore, most of marketing management deals with the mature product.
05. Decline Stage :-
The product life cycle stage in which a product’s Sales decline the sales of most product forms and brands eventually dip. The decline may be slow, as in the case of oatmeal cereal. As in the case of phonographs records.
Sales may plunge to zero. Or they may drop to a low level where they continue for many years. This is the decline stage.
Not all product follow this product life cycle. Some products are introduced and die quickly, other stay in the mature stage for along, long time some enter the decline stage and are then cycled back into the growth through strong promotion or repositioning.