Product life cycle

Product Life cycle

Level 3

1PRESENTED BY: NAVNEET JINGAR

Aims

• Discuss the Product Lifecycle• Discuss each stage of the PLC• Finally be able to draw a line of profit

2

Product Lifecycle

• The stages that a product goes through during its life: introduction, growth, maturity, and decline.

3

Product Lifecycle

• The life cycle concept may apply to a brand or to a category of a product.

• Its duration maybe as short as a few months or years, depending on the product.

• As a product progresses through the stages, changes are made to how the product is marketed.

4

Introduction Stage

• Most products fail at this stage?– Why?

• This is the stage in which the product is initially promoted. Public awareness is very important to the success of a product. If people don't know about the product they won't go out and buy it.

5

Introduction Stage

• There are two different strategies you can use to introduce your product to consumers:

– Penetration– Skimming

6

Introduction Stage

• Penetration– This strategy usually set the product price very

high initially and then gradually lowers it over time.

– This is a good strategy to use if there are few competitors for your product.

– Profits are high with this strategy but there is also a great deal of risk. If people don't want to pay high prices you may lose out.

7

Introduction Stage

• Skimming– In this case you set your prices very low at the

beginning and then gradually increase them.

– This is a good strategy to use if there are a lot of competitors who control a large portion of the market.

– Profits are not a concern under this strategy. The most important thing is to get you product known and worry about making money at a later time.

8

Growth

• The Growth stage is where your product starts to grow. In this stage a very large amount of money is spent on advertising. You want to concentrate of telling the consumer how much better your product is than your competitors' products.

• What are the ways in which you could prompt a product?

9

Growth

• If you are successful with your advertising strategy then you will see an increase in sales. Once your sales begin to increase your share of the market will stabilise.

10

Maturity

• The third stage in the Product Life Cycle is the maturity stage. If your product completes the Introduction and Growth stages then it will then spend a great deal of time in the Maturity stage.

• During this stage sales grow at a very fast rate and then gradually begin to stabilise.

11

Decline

• This is the stage in which sales of your product begin to fall. Either everyone that wants to has bought your product or new, more innovative products have been created that replace yours.

• Many companies decide to withdrawal their products from the market due to the downturn. The only way to increase sales during this period is to cut your costs reduce your spending.

12

Other Considerations• Very few products follow the same cycle. Many products

don't even make it through all four stages. Some stages even bypass stages

• This is the problem with the PLC. There is no set way for a product to go. Therefore, every product requires a great deal of research and close supervision throughout its life. Without proper research and supervision your product will probably never get out of the first stage.

• Some Useful Links: • Marketing Teacher - Product Life Cycle • Product Life Cycle

13

14

Conclusion

• Discussed the Product Lifecycle• Discussed each stage of the PLC• Drew a line of Profit

15

16