Product life Cycle

Product life cycle is a series of stages start from introduction of product and end on decline stage. At each stage organization take different strategy according to product nature, environment,profits,revenues and customers. product life cycle change from product to product each company PLC is different from other.

Some product move from introduction stage to maturity in a fly like fashion(shoes and clothes) and decline in a short span of time. Products like Coca cola have long life cycle and remain in maturity stage for a long time.

Following are the stages of product life cycle.

1-Introduction

2-Growth

3-Maturity

4-Decline

Introduction

In introduction stage organization put lot of efforts and money because product is just enter to the market it require customer awareness and acceptance. Marketing budget is high due to different promotional strategies, distribution is restricted to limited markets.

In this stage organization face less competition because adopter for the product is not huge. Production capacity is under utilize because demand of the product is low results in high cost per unit and this is transferred to customer in the form of price.

Growth

In this stage sales start rapidly increasing and product adopted by most of the customer. Organization maintain the quality to build long term relationship with customers. Price for the product is maintain and additional features and support services may be added to gain customer trust.

New distribution channels are added for customer reach, most of the time customer is willing to buy the product but due to unavailability he or she might go for competitors products. Aggressive promotional strategies are required to position the brand in the mind of customers and let them feel your product presence everywhere.

Maturity

In this stage product sales reach to the saturation level where growth is slow down due to competitors products presence in the market. Distribution and promotion is carried in the same way or even spread  more to gain market share. Number of unit produce increase reduce the cost and benefit the customers in the form of price cut.

Competitors offer similar products in this case organization must adopt promotional strategies to differentiate its products from competitors. Every organization wishes that there products remains in maturity stage for the long time to generate high revenues and profits.

Decline

This is the last and critical stage for organization to take critical decision. Competition increase to great extent in this phase result in rapid downward slope graph of sales. Organization might take decision to drop out this product or try to stick with the product and hope for some better results.

In this stage organization reduce price, offer discounts and buy one get one sort of offers. Looking for other segments can extend the life of the product like Johnson baby lotion is used as a body moisturizer.

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