The Product Life Cycle (PLC) is an important concept in marketing that provides insights into a product competitive dynamics.
The product life cycle portrays distinct stages in the sales history of a product. PLC portrays four things
Product have a limited life.
Product sales pass through distinct stages, each posing different challenges to the seller.
Profits rise and fall at different stages of the product life cycle.
Product require different marketing, financial, manufacturing, purchasing and personnel strategies in each stage of their product life cycle.
A typical PLC follows an S-Shaped curve. This curve is typically divided into four stages, known as introduction, growth, maturity and decline.
Introduction:- A period of slow sales growth as the product is introduced in the market. Profits are non-existent in this stage because of heavy expenses of product introduction.
Growth:- a period of rapid market acceptance and substantial profit movement.
Maturity:- A period of a slowdown in sales growth because the product has achieved acceptance by most potential buyers. Profits stabilize or decline because of increased marketing out lays to defend the product against competition.
Decline:- The period when sales show a downward drift and profit erode.