Bhandari and Rathi College, Guledgudd
P. G. Department of Commerce
Class – [Link] First Year
Subject – Marketing
Management
Topic – Product Life Cycle
Presented By – Assistant.
Prof.
[Link]
PRODUCTS LIFE CYCLE
Products life cycle can have a direct bearing
on a company’s survival. The life cycle of a
product consists of four stages: introduction,
growth, maturity, and decline. The concept of
product life applies to a generic category of
product. A product life cycle consists of
aggregate demand over an extended period of
time for all brands comprising a generic
product category.
Stages of PLC
1. Introduction
2. Growth
3. Maturity
4. Decline
INTRODUCTION STAGE:
During this stage, sometimes called pioneering stage, a
product is launched into the market in a fullscale
marketing programme. It has gone through product
development, including idea screening, prototype, and
market tests. The entire product may be new, such as the
zipper, the videocassette recorder, and the fast substitute
for prepared foods. Or it may be well known but have a
significant novel feature that, in effect, creates a new
product category; microwave ovens and in – line skates
are examples.
GROWTH STAGE
The growth stage is marked by a rapid climb
in sales. The early adopters like the product,
and additional consumers start buying the
product. New competitors enter the market,
attracted by the opportunities for large- scale
production and profits. They introduce new
product features and expand the distribution
chain. Profits increase during the growth
stage as (i) promotion cost are spread over a
large volume (ii) unit manufacturing cost fall
faster than price declines owing to the
producer learning effect.
MATURITY STAGE
At some point, a products rate of sales growth will slow
down, and the product will enter a stage of relative
maturity. This stage normally lasts longer than the
previous stage, and it poses formidable challenges to
marketing management. The maturity stage can be divided
into three phases. in the first phase, growth maturity, the
sales growth rate starts to decline. In the second phase,
stable maturity, sales flatten on per capita basis because of
market saturation. In the third phase, decaying maturity,
the absolute level of sales starts to decline, and customers
start switching to other product and substitutes
DECLINE STAGE
The sales of most product forms and brands eventually
decline. The sales decline might be slow, as in the case of
oatmeal; or rapid, as in the case of Edsel automobile.
Sales may plunge to zero, or they may petrify at a low
level. Sales decline for a number of reasons, including,
including technological advances, shifts, in consumer
tastes, and increased domestic and foreign competition.
All lead to overcapacity, increased price-cutting, and
profit erosion.
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