PRODUCT LIFE CYCLE ANALYSIS

BY: GAZAL SHARMA

Introduction
The product life cycle is a concept that seeks to describe a products sales, competitors, customers and marketing emphasis from its beginning until it is removed from the market.

PLC

STAGES

Cost
Break Even

INTRODUCTORY STAGE

No profits or marginal profits Limited sales of the product Higher promotional expenditures No competition in the case of innovative products

GROWTH STAGE

Rapid increase in sales of product Acceptance of product by the consumers Maximum profits to the company Entry of competitors in the field Reasonable promotional expenditures

MATURITY STAGE

Increasing competition. Stable trend in sales till mid of the stage. Slow decline in sales at the end of the stage. Declining profits. Promotional expenditure increase. Extra efforts by marketing company.

DECLINE STAGE

Marginal marketing firms close their operation with the start of the stage Decline in sales at fast speed Increase losses No dealers support

STRATEGIES FOR EACH STAGE OF PRODUCT LIFE CYCLE

FOR INTRODUCTORY STAGE

Reduce the time span High pricing strategy Penetration pricing strategy Focus on Early adopters Before the expiry of the stage channels of distribution should be well set. Use of sales promotion schemes

GROWTH STAGE
Price reduction Focus on early Majority Effective supply chain management New uses of the product More uses of the product Addition of new brands

MATURITY STAGE

Focus on Late Majority Product alteration and modification Differential advantage strategy Re-positioning of brand Intensive use of sales promotion Techniques Introduction of new product

DECLINE STAGE

Identifying the weak products Selective Distribution Product Simplification decision

FACTORS AFFECTING PLC

Legal protection to the product Chances of entry of competitors Rate of technical change Rate of market acceptance

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