INSTITUTE OF MANAGEMENT

STUDIES
MBA (FT) Marketing : SEM 3rd

PRODUCT & BRAND MANAGEMENT

PRESENTATION ON :
PRODUCT LIFE CYCLE
ROLL NO: 62009

PRESENTED TO : PRESENTED BY:

Ms. Pallavi Kapooria Akshita Soni
 INTRODUCTION
As consumers, we buy millions of products every year. Just like
us, these products have a life cycle. The Product Life
Cycle(PLC) is an important concept in marketing.

It describes the stages a product goes through from when it was

first thought of until it is finally removed from the market.

Not all products reach this final stage. Some continue to grow and
others rise and fall.

The cycle is broken into 4 stages

Introduction , Growth, Maturity, & Decline.
The idea of PLC is used in marketing to decide when it is
appropriate to advertise, reduce prices, explore new markets or
create new packaging.
PRODUCT LIFE CYCLE : It is a theoretical model which describes or
predicts the stages of product goes through during its life.

First, a product idea is generated in development phase & is implemented

during the introduction phase, and the idea undergoes research and
development. If the idea is determined to be feasible and potentially
profitable, the product is produced, marketed and rolled out in the growth
phase. Assuming the product becomes successful, its production will grow
until the product becomes widely available and matures in the mature
stage. Eventually, demand for the product declines and it becomes obsolete,
resulting in the decline stage.

EXAMPLE : Television has products all along the stages of the product life
cycle. As of 2016, 3D TVs are in the introduction phase, DVR(Digital Video
Recorder) is in the growth stage, DVDs (Digital Video Disk) are in the
maturity phase, and video cassettes are in the decline stage.
STAGES OF PLC :
Development
Product Life Cycle Model can be
Introduction applied to :

Growth Product Category

Style
Maturity Brand or Model

Decline
GRAPH REPRESENTING PRODUCT LIFE CYCLE :
 DEVELOPMENT STAGE :
Product development is the first stage of the product life cycle. It begins only when
you find and start to develop a new idea. At the development stage of the product life
cycle, you should ensure that your idea will meet:

Potential customer expectations.

Design, resource and manufacturing requirements.
Strategy outlined in your business plan .

At this stage, focus should be on working with a team of designers, manufacturers or

product development experts. To further develop your product, you should:

Consult team members on development plans.

Speak to suppliers and other business associates.
Communicate with customers about your plans.
Consider the environmental impacts of your product.
Ask a group of potential customers to test your product and give feedback.
Characteristics of Development Stage :
New Product Development or NPD.
Often complex.
May not be successful.
May involve a long lead time before sales are achieved.
EXAMPLE :
You may be an inventor who has already come up with a new product that needs
some help to regularly develop new ideas, you might want to partner with innovators,
designers, university researchers or manufacturers to develop your ideas generation
processes. Then you can work as a team to develop the idea.
INTRODUCTION STAGE :
In the Introduction Stage, the firm seeks to built product awareness & develop
a market for the product. Focus should be on building a base for your product
& on the following marketing factors:
Pricing
Distribution
Promotion

EXAMPLE :Holographic Projection: Only recently introduced into the

market, holographic projection technology allows consumers to turn any
flat surface into a touch screen interface.
CHARACTERISTICS OF INTRODUCTION STAGE :
1. SALES Usually low sales.
2. COST High unit costs.
3. PROFIT Usually negative cash flow.
4. CUSTOMERS Innovators & Early adopters.
5. COMPETITORS Few at initial stage.
6. PRODUCT Product Branding & quality level is established & intellectual
property protection should be done like patents & trademarks.

STRATEGIES TO BE USED IN INTRODUCTION STAGE :

1. PRODUCT Offer a basic product.
2. PRICE Use cost plus or high skim pricing.
3. DISTRIBUTION Selective until customer show acceptance.
4. ADVERTISING Build product awareness among customers.
5. SALES PROMOTION Heavy sales promotion.
GROWTH STAGE :
In the Growth stage, the firm seeks to build brand preference & increase market
share. At this point in product's life cycle, efforts should be into:
Increasing your product's market share.
Creating a brand preference for your customers.
Maintaining product quality & pricing to increase demand.
Increasing distribution channels to cope with demand.
Aiming promotion at a wider audience.

EXAMPLE : Tablet PCs: There are a growing number of tablet PCs for
consumers to choose from, as this product passes through the Growth stage of
the cycle and more competitors start to come into a market that really
developed after the launch of Apples iPad.
CHARACTERISTICS OF GROWTH STAGE :
1. SALES Rapid rising sales.
2. COST Average unit cost for economy scale.
3. PROFIT Cash flow may become positive, profits rise.
4. CUSTOMERS Early adopters.
5. COMPETITORS Rising profits attracts entry of new competitors.
6. PRODUCT Product quality is maintained & additional features are added.

STRATEGIES TO BE USED IN GROWTH STAGE :

1. PRODUCT Offers product extension, services & warranty.
2. PRICE Pricing is maintained as to penetrate into the market.
3. DISTRIBUTION Built intensive distribution as demand increases &
customer accept the product.
4. ADVERTISING Promote awareness & interest in mass market.
5. SALES PROMOTION Reduce to take advantage of heavy customer
demand.
MATURITY STAGE :
At Maturity Stage, the strong growth in firm diminishes. Competition may
appear with similar products. The primary objective is to defend market
share while maximizing profit. During this stage, aim should be to
differentiate product or service from others that competitors offer. It can be
done by focusing and highlighting any branding, trademarks, or customer
testimonials that may give an advantage.

EXAMPLE : DVD Players: Introduced a number of years ago,

manufacturers that make DVDs, and the equipment needed to play them,
have established a strong market share. However, they still have to deal with
the challenges from other technologies.
CHARACTERISTICS OF MATURITY STAGE :
1. SALES Peak sales.
2. COST Low unit cost is very efficient at this point.
3. PROFIT High profit for those with high market share.
4. CUSTOMERS Middle majority.
5. COMPETITORS Stable number begin to decline.
6. PRODUCT Enhancing the product features.

STRATEGIES TO BE USED IN MATURITY STAGE :

1. PRODUCT Diversify brand & models.
2. PRICE Pricing should be to match or beat competitors.
3. DISTRIBUTION Build more intensive distribution & incentives may be offered to
encourage preference over competing products.
4. ADVERTISING Stress brand differences & benefits.
5. SALES PROMOTION Increase to encourage brand switching.
DECLINE STAGE :
The sales of most products will decline at some stage. This can be due to
factors such as technological advances, trends, innovation or changing
consumer tastes. When the product reaches the decline stage of its life cycle
a significant downturn in the revenue generates.
At this stage, focus should be on :
Harvesting the product.
Reduce the costs.
Form Extension strategy.

EXAMPLE : Typewriters: Typewriters, and even electronic word processors, have

very limited functionality. With consumers demanding a lot more from the
electronic equipment they buy, typewriters are a product that is passing through the
final stage of the product life cycle.
CHARACTERISTICS OF DECLINE STAGE :
1. SALES Decline in sales.
2. COST Low cost per customer.
3. PROFIT Decline in profits & weak cash flow.
4. CUSTOMERS Laggards or possibly loyal niche segment.
5. COMPETITORS More competitors leave the market.
6. PRODUCT Rejuvenating the product.

STRATEGIES TO BE USED IN DECLINE STAGE :

1. PRODUCT Phase out weak items & rejuvenate the product.
2. PRICE Cut prices to stay competitive.
3. DISTRIBUTION Go selective: phase out unprofitable outlets.
4. ADVERTISING Reduce it to the level needed to retain most loyal
customers.
5. SALES PROMOTION Reduce it to minimal level.
WHY PRODUCT ENTER DECLINE STAGE ?
Technological Advancement.
Changes in consumer tastes & behavior.
Increased competition.
Failure to innovate & develop the product.

EXTENSION STRATEGY :
An extension strategy is a practice used to increase the market share for a
given product or service and thus keep it in the maturity phase of the
marketing product lifecycle rather than going into decline.
Extension strategies include rebranding, price discounting and seeking
new markets.
GRAPH REPRESENTING PRODUCT EXTENSION :
 EXAMPLES OF DIFFERENT STAGES :

DEVELOP- INTROD- GROWTH MATURITY DECLINE

MENT UCTION

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4 5