1. Product Decisions

2. Product Life Cycle
 The product life cycle (PLC) is a concept that
describes the stages a product goes through
from its introduction to the market until its
eventual decline and discontinuation
• The PLC consists of four main stages:

3. Product Life Cycle

4. Product Life Cycle
 The Product Life Cycle concept is based on four
premises
Products have a
limited life
Product sales pass through
distinct stages, each with
different marketing
implications
Profits from a product
vary at different stages
in the life cycle
Products require different
strategies at different
life cycle stages

5. Introduction Stage f The PLC
Sales
Costs
Profits
Marketing Objectives
Product
Price
Low sales
High cost per customer
Negative
Create product awareness
and trial
Offer a basic product
Use cost-plus
Distribution Build selective distribution
Advertising Build product awareness among
early adopters and dealers

6. Sales
Costs
Profits
Marketing Objectives
Product
Price
Rapidly rising sales
Average cost per customer
Rising profits
Maximize market share
Offer product extensions,
service, warranty
Price to penetrate market
Distribution Build intensive distribution
Advertising Build awareness and interest
in the mass market
Growth Stage of the PLC

7. Sales
Costs
Profits
Marketing Objectives
Product
Price
Peak sales
Low cost per customer
High profits
Maximize profit while defending
market share
Diversify brand and models
Price to match or best competitors
Distribution Build more intensive distribution
Advertising Stress brand differences and
benefits
Maturity Stage of the PLC

8. Sales
Costs
Profits
Marketing Objectives
Product
Price
Declining sales
Low cost per customer
Declining profits
Reduce expenditure and milk the
brand
Phase out weak items
Cut price
Distribution
Go selective: phase out
unprofitable outlets
Advertising Reduce to level needed to retain
hard-core loyal customers
Decline Stage of the PLC

9. Limitations of the PLC
1. The life cycle concept applies best to product
forms rather than to classes of products or
specific brands
2. The life cycle concept may lead marketers to think
that a product has a predetermined life, which
may produce problems in interpreting sales and
profits
3. It is only a descriptive way of looking at the
behavior of a product and the life cycle can not