Product Life Cycle

1
Product Life Cycle

• Shows the stages that products go through from
  development to withdrawal from the market

2
The Development Stage

• Initial Ideas
• May come from any of the following
• Market research identifies gaps in the mkt.
• Monitoring competitors
• Planned R D
• Luck or intuition
• Creative thinking
• Futures thinking
• Market Analysis
• Test Marketing
• Preparations for launch

3
Introduction Stage

• Advertising and promotion campaigns
• Monitor sales
• Maximize publicity
• High cost/low sales
• Target campaign at specific audience

4
Growth Stage

• Increased consumer awareness
• Sales rise
• Monitor market competitors
• Product comparison more likely
• Goal Brand loyalty

5
Maturity

• Sales level off
• Cost of supporting the product declines
• Price elasticity of demand
• Brand loyalty key to survival
• Weaker rivals drop out
• Low cost critical as new competitors appear
• Decline prices and profits
• Competitors cut prices to attract business

6
Saturation

• Market is flooded
• Develop new strategies
• Search new markets
• Develop new uses
• Re-package or format
• Improve the quality

7
Decline and Withdrawal

• Fashions change
• Technology changes
• Sales decline
• Cost of supporting starts to rise too far
• Decision to withdraw may be dependent on
  availability of new products and whether
  fashions/trends will come around again