PRODUCT LIFE CYCLEJocelyn M. Evangelista7 February 2014

Product Life CycleI. Definition

II. Four Stages and Marketing Objectives

III. Characteristics

IV. Common Product Life Cycles

Product Life CycleI. Definition

A business analysis that attempts to identify distinct stages in the sales history of the product

Product Life CycleII. Four Stages and Marketing Objectives

1. Introduction – create product awareness & trial

2. Growth – maximize market share

3. Maturity – maximize profit while defending market share

4. Decline – reduce expenditure

Product Life Cycle

Product Life CycleIII. Characteristics

1. Introduction Stage

◦ Slow sales growth.◦ Products need to establish

themselves in the market place.

◦ Negative or low profits.

Product Life CycleIII. Characteristics

2. Growth Stage

◦ Rapid sales growth.◦ Early adapters like the

product & additional consumers start buying it.

◦ Sales rise much faster than expenditures in promos.

Product Life CycleIII. Characteristics

3. Maturity Stage

Three Phases :

1)Growth – Sales growth starts to slow; new competitive forces emerge.

2)Stable – Reached market saturation

3)Decaying Maturity – consumers begin switching to other products.

Product Life CycleIII. Characteristics

4. Decline Stage

◦ End of the product life.◦ Period of the market's sale

are significantly below the peak and are declining.

Product Life Cycle

IV. Common Product Life-Cycle Patterns

Growth-Slump-Maturity

sales grow rapidly when product is first introduced, falls, & stabilizes

Product Life Cycle

IV. Common Product Life-Cycle Patterns

Cycle-Recycle - often describes the sales

of new drugs

Product Life Cycle

IV. Common Product Life-Cycle Patterns

Scalloped - succession of life-cycles

based on discovery of new charcteristics, uses or users.

Summary

Periodic examination of products is appropriate because strategies change as products move through their life cycle.