Product Life Cycle

Definition
A product life cycle is the amount of time a product goes from being
introduced into the market until it's taken off the shelves.

The product life-cycle is an important tool for marketers,

management and designers alike. It specifies four individual
stages of a product's life and offers guidance for developing
strategies to make the best use of those stages and promote the
overall success of the product in the marketplace.
Basics
There are four stages in a product's life cycle—introduction, growth,
maturity, and decline.
The concept of product life cycle helps inform business decision-
making, from pricing and promotion to expansion or cost-cutting.
Newer, more successful products push older ones out of the market.
The classic graph for the product lifecycle is a
sales curve that progresses through stages:
• A sharp rise from the x-axis as a
product transitions from
Introduction to the Growth
phase;
• A sustained, rounded peak in
Maturity;
• and a gradual Decline that
portends its withdrawal from
the market.
Not all product lifecycles are the same
 Example of the Product Life Cycle 2018
Introduction – Self-driving cars. Self-driving cars are still at the
testing stage, but firms hope to be able to sell to early adopters
relatively soon.
Growth – Electric cars. For example, the Tesla Model S is in its
growth phase. Electric cars still need to convince people that it will
work and be practical. As there are more electric charging points
and more people adopt, it becomes easier to sell to those who are
more sceptical of new technology like electric cars.
Maturity – Ford Focus. The Ford Focus is a well-established car. It
has a good brand reputation and has reached its peak level of
market penetration. It would be difficult to gain a significantly
greater market share. The product life cycle of the Ford Focus has
been extended by constant upgrades and redesigns to keep the car
on top of the market.
Decline – Diesel cars. Since governments have expressed concern at
the level of pollution from diesel cars. Some cities have threatened
to ban diesel cars within a few years. Sales have fallen considerably
and the market for diesel cars may be in terminal decline.
 The benefits of looking at marketing through
the lens of the product lifecycle are multifold:
• Provides a broad understanding of how your product fits into lifecycles for
the product class, form, or brand
• Identifies which stage you’re in to help you understand what you need to
communicate and how to do so persuasively.
• Spots the early signs of a pending transition to a new stage and suggests
how your marketing campaigns should accommodate that change.
 Implications of PLC
Technology and Types of customers
Introduction Stage
How to identify if you’re in the Introduction stage
If your product hasn’t yet launched, it’s obvious that you’re in this
initial phase of the product lifecycle.

For recently launched products, marketers in the Introduction stage

focus on creating awareness and motivating potential buyers to
consider a product—to be in the conversation when potential buyers
consider their options.
Introduction Stage
What marketing needs to accomplish during the Introduction
• Create product awareness and trial
 Introduction Stage
What marketing needs to accomplish during
the Introduction
• Create product awareness and trial
• Unlike successive stages, there’s no benefit
to prolonging the Introduction phase. As a
result, the primary marketing goal is to roll
out campaigns that move quickly past
Introduction to Growth: To build enough
awareness that consumers know of the
solution (if it’s a new market) or know of
your company when considering the
solution (if it’s an established market).
Introduction Stage
Research needs
• Without a wealth of post-purchase consumer feedback, marketers in the Introduction
stage may rely on user research conducted by others in the company, like the product
management team. This may include data from test marketing or initial market research.

• Questions marketers need to answer include:

• Why did they create this product?

• What problem does it solve?
• How big is the market?
• Who are the intended purchasers?
• Which potential users or companies are influential in this space?
Introduction Stage
How long is the expected product lifecycle? 

Not every company is preparing for a full product lifecycle. VC-backed companies
that focus on user adoption—at the expense of profitability or even revenue—may
never plan for phases beyond Introduction and Growth.
Introduction Stage
How long is the expected product lifecycle?
Introduction Stage
Marketing Objectives

Raising product awareness through advertising / word of mouth.

Offering the product at discount – penetration pricing to tempt customers to try the
product.
Target early adopters and influential market leaders. For example, firms may offer
free product reviews to influential bloggers in the market.
Firms need to find willing suppliers who are willing to stock.
This phase will not be profitable because costs are high, but revenue relatively low.
Example
Signs you’re headed to the Growth stage
When marketing conversations focus more on competitors—rather than creating a
market or earning consideration among potential buyers—you’re headed toward
the Growth phase of product lifecycle marketing.

Another sign: You’ve moved past the initial product launch and must consider how
to promote product updates to an existing consumer base or use them as a means
to acquire new buyers.
Growth Stage
The Growth stage is the period with the sharpest increase in sales. It
includes a significant boost in market presence, the addition of new
product features, and a greater emphasis on positioning relative to
the competition.
How to identify if you’re in the Growth stage
Levitt explains one way to determine if your company is in the
Growth period:

“Instead of seeking ways of getting consumers

to try the product, the originator now faces
the more compelling problem of getting them
to prefer his brand.”
How to identify if you’re in the Growth stage
If you’re in an emerging market, you may lure new competitors into
the field. If you’re in an established market, you may go head-to-
head with industry stalwarts more often.
How to identify if you’re in the Growth stage
There is one benefit of
increased competition: Your
competitors’ campaigns may
help increase overall demand
for your product class, which
allows marketing teams to
shift resources back toward
promoting your product.
What marketing needs to accomplish during the Growth stage

Maximize market share

During the Growth period, the marketing
team works to widen their audience and
build brand preference.
Research needs
What have you learned about your
consumers?
By the Growth stage, you should have
enough consumer data to begin building
marketing strategies based on consumer
experiences with your product, rather than
consumer attitudes or behaviors related to
the problem your product solves or
competitor offerings.
Research needs
Qualitative user research has many
sources:

User/usability testing
Live chat transcripts
One-on-one customer interviews
On-site surveys
Research needs
That research, in turn, affects marketing
plans:

Creation of user personas

Development of marketing copy
Ability to make data-driven UX decisions
Prioritization of meaningful product
updates
How does your company and product compare to competitors?

Also during the Growth phase,

you’ll dive deeper into competitor
analyses to determine how your
value proposition compares and
which aspects of your product or
brand will help differentiate.
Questions marketing needs to answer
How are you positioning your product? If your current
product is more advanced than competitors, you may be
best positioned to earn a dominant market share—which
means pushing more resources into current campaigns (at
the expense of near-term profits).

If you’re product development lags behind, you may have

more success competing on value, or by developing a brand
—even a brand-owned term—that makes an emotional
appeal to consumers.
Questions marketing needs to answer
Marketing Objectives
Firms need to capitalize on growth to extend product sales from
small retailers to big supermarkets.
Firms can change marketing from niche areas to a more mass
market.
The firm can adapt to consumer feedback and offer new
features/better consumer support.
Signs you’re headed to the Maturity stage
Growth transitions to Maturity as the rise in sales
(not profits) levels out. By the end of the Growth
stage, most people who want your product have it
(or a competitors’), and the focus shifts toward
winning customers from competitors and making
marketing more efficient.
Maturity Stage
The Maturity phase represents
the height of a product’s adoption
and profitability. The height of
the apex depends on past
achievements during the Growth
period; the length of the Maturity
phase depends on how long
marketing can sustain the
product’s dominant market
position.
How to identify if you’re in the Maturity stage
“The first sign of its advent,” Levitt argues, “is evidence of
market saturation. This means that most consumer
companies or households that are sales prospects will be
owning or using the product.”

In practical terms, it means that most “new” customers are

not new to your product class but, perhaps, new to your
brand—they’ve switched from a competitor. Conversely,
many of your losses are wins for your competitors.
What marketing needs to accomplish during the Maturity stage
Maximize profit while defending market share
Levers that worked during the Introduction and Growth
periods have a lesser impact during the Maturity phase.
More competitors and an established market likely
mean that differentiation in product features declines,
and you may have competitors at both ends of the
spectrum—those who offer the product more cheaply
and those who offer a higher-end version.
How can you prolong the Maturity phase? Marketers can
extend the Maturity period in several ways:

Identifying new demographics for the product. Is there a

subset of potential users that, if marketing reframed its
messaging, could become viable prospects?
Identifying new uses for the product. Bubble wrap, the slinky,
Coca-Cola—the list of products known for their secondary uses
is long. You probably won’t discover an alternative for your
product that generates decades of exponential growth, but you
may find a way to prolong the Maturity phase for a year.
Hope a new style or fad comes to the rescue. The Rubik’s
Cube seems good for a once-a-decade revival:
Signs you’re headed to the Decline stage
Decline
The decline phase begins as product sales and
profits shrink. Still, an effective marketing effort
can make a decline more gradual, earning
additional sales from “laggards” and giving a
company more time to pivot to its next effort.
How to identify if you’re in the
Decline stage
Is the market consolidating into a few major
players? Are margins shrinking? Is the product
viewed as a commodity? All are signs that you’ve
reached the Decline phase in your product’s
lifecycle.
Questions marketing needs to
answer
How can you milk the brand?
How can you reduce marketing spend?
When will the company harvest or
withdraw the product?
Example
Stages