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My answer won´t add any more value for this debate.
Just an appointment. In any life cycle of a product/service we can make it longer (the time) in certain stages; mainly in the maturity and decline level.
Sometimes companies don't have the resources to launch new products, so the solution are subtle (or sometimes deep) characteristics changes in the products that are in those stages.
Can also be done in the package or even, some companies, change the niche of their product to prolong the maturity level and not enter in decline.
Thanks to Sidra Asiq for full description of product life cycle and to Almutuz Bakry Sidahmed for useful comment
Just to add that not all products pass through “S” shaped PLC. Some products show cycle-recycle shape and some scalloped shape. So, there could be several types of PLC depending on product category. The interesting fact is that most companies cannot predict size of PLC in advance or know what stage they are in or predict the duration of stage. As a result, companies have to go for research and find out the strategy for marketing mix.
Product Life Cycle Stages
As consumers, we buy millions of products every year. And just like us, these products have a life cycle. Older, long-established products eventually become less popular, while in contrast, the demand for new, more modern goods usually increases quite rapidly after they are launched.
Because most companies understand the different product life cycle stages, and that the products they sell all have a limited lifespan, the majority of them will invest heavily in new product development in order to make sure that their businesses continue to grow.
Product Life Cycle Stages Explained
The product life cycle has 4 very clearly defined stages, each with its own characteristics that mean different things for business that are trying to manage the life cycle of their particular products.
Introduction Stage – This stage of the cycle could be the most expensive for a company launching a new product. The size of the market for the product is small, which means sales are low, although they will be increasing. On the other hand, the cost of things like research and development, consumer testing, and the marketing needed to launch the product can be very high, especially if it’s a competitive sector.
Growth Stage – The growth stage is typically characterized by a strong growth in sales and profits, and because the company can start to benefit from economies of scale in production, the profit margins, as well as the overall amount of profit, will increase. This makes it possible for businesses to invest more money in the promotional activity to maximize the potential of this growth stage.
Maturity Stage – During the maturity stage, the product is established and the aim for the manufacturer is now to maintain the market share they have built up. This is probably the most competitive time for most products and businesses need to invest wisely in any marketing they undertake. They also need to consider any product modifications or improvements to the production process which might give them a competitive advantage.
Decline Stage – Eventually, the market for a product will start to shrink, and this is what’s known as the decline stage. This shrinkage could be due to the market becoming saturated (i.e. all the customers who will buy the product have already purchased it), or because the consumers are switching to a different type of product. While this decline may be inevitable, it may still be possible for companies to make some profit by switching to less-expensive production methods and cheaper markets.
We're regularly bombarded by advertisements telling us about exciting new features of existing products: a car that now has SatNav as standard, perhaps; a brand of shampoo with a new, improved formula; or a snack that now contains even more delicious fruit.
Yet, at the same time, if we go to the shops, there are hundreds of products which are seemingly not advertised at all.
So why are some established products regularly given make-overs and generous new marketing budgets, while others are apparently left to sell themselves?
One answer is that the marketers are acting according to where the item is in its product lifecycle.
Understanding the Model
Just as people go through infancy, childhood, adulthood and old age, so too do products and brands. And just as we swing from being needy, to being overall contributors to our families or to society, and then back to being needy again over the course of our lives, so – in effect – do products.
The four phases usually used to describe a product's life cycle are:
· Introduction.
· Growth.
· Maturity.
· Decline.
During the earlier parts of the product lifecycle, the cost of promoting the product may be larger than the revenue it brings in. However, for successful products that are marketed effectively, the product will become increasingly profitable during the Growth and Maturity phases. A typical lifecycle for a well-managed product is shown in Figure1, below.
As products moves from lifecycle phase to lifecycle phase, the elements of the marketing mix used to promote them change.
· During the Introduction phase, there will most-likely be heavy promotional and advertising activity designed to raise awareness of the new product, and to seek sales amongst early adopters – adventurous consumers who like to own cutting edge products.
Depending on the nature of the product, it will either have a premium price so that its development costs can be recouped quickly (this is the approach used with most high-tech products) or be priced low to encourage widespread adoption – what marketers call "market penetration".
· Moving on to the Growth phase, promotional activities will tend to focus on expanding the market for the product into new segments – usually either geographic or demographic – and supporting this by expanding the product family, for example with new flavors or sizes (cartons of fruit drinks specifically sized for kids lunch boxes, for instance).
· By the time a product reaches its Maturity phase, the company producing it needs to reap considerable rewards for the time and money spent developing the product so far.
The product's features may continue to be refreshed from time to time, and there will still be some promotion to differentiate the product from the competition and increase market share. However, the marketing activity and expenditure levels may be much lower than earlier on in the lifecycle.
· Finally, once the product begins to Decline, marketing support may be withdrawn completely, and sales will entirely be the result of the product's residual reputation amongst a small market sector. (Elderly people, for example, may go on buying brands that they started using forty or even fifty years earlier.)
By this stage, the most important decision that needs to be made is when to take the product off the market completely. It can be tempting to leave a declining product on the market – especially if it served the company well in its time, and there's a certain sentimental attachment to it. However, it is essential that the product is not allowed to start costing its producer money, and this can easily happen if production costs increase as volumes drop.
More importantly, the old product's very existence can absorb managers' time and energy, and can discourage or delay the development of a new, potentially more profitable replacement product.
Controlling the Length of Lifecycle Phases
The duration of each lifecycle phase can be controlled, to a certain extent. This is particularly true of the Maturity phase: this is the most important one to extend from a financial point of view because this is the period when the product is at its most profitable.
Typical tactics designed to extend the maturity phase include:
· Increasing the amount of the product used by existing customers (this is why food producers issue recipe cards that use their ingredients).
· Adding or updating product features.
· Price promotions to attract customers who use a rival brand.
· Advertising to encourage trial of the product people who don't use this category of product at all.
Limitations of the Model
One criticism of the product lifecycle concept is that it in no way predicts the length of each phase, and nor can it be used to forecast sales with any accuracy.
Another is that the model can be self-fulfilling: If a marketer decides that a product is approaching its Decline phase, and so stops actively marketing it, the product's sales will almost inevitably decline. This might not have happened had it been managed as if it was still in its Maturity phase.
Furthermore, it's possible that by improving a product aggressively on an ongoing basis, growth can continue for a long time. Just think of the market for PCs in thes ands: Successful producers launched new and better products month after month after month.
Successful marketers need to draw on a wide range of data and analysis to help them decide which phase a product is in, and whether that phase can be extended. And while this model is useful and thought-provoking, they need to base their decisions on a good understanding of the facts.
The Product Lifecycle model describes how products go through the four phases of Introduction, Growth, Maturity and Decline after they are launched. Each phase requires a different mix of marketing activities to maximize the lifetime profitability of the product.
The purpose:
In general, this involves early investment to help secure revenue later on. While the model does not predict sales, when used alongside carefully analyzed sales figures and forecasts, it provides a useful guide to marketing tactics that may be most appropriate at a given time.
The life cycle of the product starting from manufacturing until it reaches the consumer
We don't need it. It just exists - it is an observation. We observe that sales of products tend to follow a pattern, which we call the product life cycle. Some people like to divide this cycle into four phases, because it can be useful in understanding what's going on in the business and planning for the future. You could easily divide it into three or five phases, but four just seems to work best most of the time.
Product life cycle times may be measured in hours or decades, depending on the circumstances. (Compare tickets for a Justin Bieber concert and Kelloggs Corn Flakes.)
I fully agree with the answers been added by EXPERTS............Thanks.
thanks
it is good question
I think before answers was ok and benifits
Production life cycle is the stages of product or service from 1st introduction to the market to final decline of it & Stages in the product life cycle classified:
• Introduction stage. The product offering in the market through the marketing effort and a sharp center and is designed to establish and clarify the identity and upgrade up to a maximum of consciousness. Many of the stimulus and the rush to buy going to happen at this stage.
• growth phase. Can be known to increase sales and the emergence of competitors. In the part of the seller it is also characterized by the growth phase marketing activities pollutants. Making some frequent flier customers purchase.
• maturity. This phase can be defined when competitors begin to leave the market and sales speed drops dramatically, and sales of the important centers steady level size. At the present time loyal customers buy the product.
• Decline stage. Long-term effects of competition, and economic conditions is appropriate, new trends, etc., illustrated gradient often in sales.
Several different models for the life cycle of the industry has developed to handle product development, market and / or industry. Although the models similar, but they differ in relation to the number and names of the stages
