Product Life Cycle

Name:

4 5
6
3
7

2
1

Time Sales volume Development Introduction

Saturation Decline Growth Maturity

A. Identify each stage of the life cycle using the terms above.

1. 2. 3. 4.

5. 6. 7. 8.

B. Investment in the product will be high at the………………………………………………………. stage

because the company have to pay for research, product design, testing etc.

C. Draw and label an extra line on the graph to show a ‘product extension’.
 Product Life Cycle
D. Which stage of the product lifecycle includes the following features: (fill in the left box)

Features Stage of the

product life cycle
The business may decide to:
 Changing the product in some way (features)
 Target a new market
 Change the design or packaging
 Create a new ad campaign
 Sell through more (or less) outlets
 Increase promotion spending
 Prototype is tested with further research before a launch
 No sales and high costs
 Price discounts may be offered, especially if the company
does not want to ‘extend’ the product and just wants to
get rid of old stock.
 Advertising reduced or stopped.
 Product may be withdrawn completely.
 Sales revenue is stable but there is now lots of
competition in the market.
 Competitive pricing used.
 High levels of advertising.
 Price reductions may be considered to prevent sales
decline.
 Product is launched with slow sales because of low
product or brand awareness.
 Penetration pricing or price skimming depending on
demand, competition and brand awareness.
 Sales are still increasing but at a much slower rate as
competitors release similar products to the market.
 Competitive pricing introduced.
 Lots of advertising to compete.
 Profits at their highest.
 Sales are increasing rapidly.
 Persuasive advertising used as new competitors enter the
market.
 Profits start to grow as development costs have now been
recovered.