PRODUCT LIFE CYCLE

2. WHAT IS PRODUCT LIFE CYCLE(PLC)
•The product life cycle. A new product progresses through a sequence of stages
from introduction to growth, maturity, and decline. This sequence is known as
the product life cycle

3. Introduction: When the product is brought into the market. In this stage, there's heavy
marketing activity, product promotion and the product is put into limited outlets in a few
channels for distribution. Sales take off slowly in this stage. The need is to create
awareness, not profits.
The second stage is growth. In this stage, sales take off, the market knows of the product;
other companies are attracted, profits begin to come in and market shares stabilize.
The third stage is maturity, where sales grow at slowing rates and finally stabilize. In this
stage, products get differentiated, price wars and sales promotion become common and a
few weaker players exit.
The fourth stage is decline. Here, sales drop, as consumers may have changed, the product is
no longer relevant or useful. Price wars continue, several products are withdrawn and cost
control becomes the way out for most products in this stage.

6. EXAMPLE OF INTRODUCTION STAGE
•3D televisions: 3D may have been
around for a few decades, but only
after considerable investment from
broadcasters and technology
companies are 3D tvs available for the
home, providing a good example of a
product that is in the introduction
stage.

7. EXAMPLE OF GROWTH STAGE
Blue Ray Players: With advanced technology
delivering the very best viewing experience,
Blue Ray equipment is currently enjoying the
steady increase in sales that’s typical of the
Growth Stage.

8. EXAMPLE OF MATURITY
•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 that are characteristic of
the maturity stage.

9. EXAMPLE OF DECLINE STAGE
•Video recorders: while it is still
possible to purchase vcr”s this is a
product that is definitely in the
decline stage, as it’s become easier
and cheaper for consumers to
switch to the other, more modern
formats.

10. RELEVANCE OF PRODUCT LIFE CYCLE
INTRODUCTION STAGE – OBJECTIVES
1.PRICING
2.DISTRIBUTION
3.PROMOTION

11. PRICING
• PRICE YOUR PRODUCT OR SERVICE
• You should initially start pricing at the highest point you believe it is possible to achieve. You can
also consider a skimming price strategy: charging a relatively high price for a short time when a
new, innovative, or much-improved product is launched onto a market. The aim with skimming is
to skim off customers who are willing to pay more to be one of the first to have a new product.
You can lower the prices later when demand from the early adopters falls.
• A penetration pricing strategy may work best for businesses entering a new market or building on
a relatively small market share. It involves the setting of lower, rather than higher prices to
achieve a large, if not dominant market share.

12. DISTRIBUTION
•Your distribution should be selective and limited to a specific type of consumer,
until your product is accepted. Also, you should consider different distribution
models during different periods of the product life cycle, eg new products for
different seasons in a clothes shop.

13. PROMOTION
•You should try to build brand awareness at an early stage. It is worth working
with a brand design or communications agency as you develop a product to
establish a strong brand.
•You can use samples or trial incentives to capture early adopters of the product or
service. Introductory promotions can also help convince potential resellers to
carry your lines.

14. GR0WTH STAGE
•1. INCREASING COMPETETION
•2.LOWER PRICES
•3.DIFFERENT MARKETING APPROACH

15. INCREASING COMPETITION
•Increasing competition: when a company is the first one to introduce a product
into the market, they have the benefit of little or no competition. However, when
the demand for their product starts to increase, and the company moves into the
growth phase of the product life cycle, they are likely to face increased
competition as new manufacturers look to benefit from a new, developing market.

16. LOWER PRICES
•Lower prices: during the introduction stage, companies can very often charge
early adopters a premium price for a new product. However, in response to the
growing number of competitors that are likely to enter the market during the
growth phase, manufacturers may have to lower their prices in order to achieve
the desired increase in sales.

17. DIFFERENT MARKETING APPROACH
•Different marketing approach: marketing campaigns during the introduction
stage tend to benefit from all the buzz and hype that surrounds the launch of a
new product. But once the product becomes established and is no longer ‘new’, a
more sophisticated marketing approach is likely to be needed in order to make the
most of the growth potential of this phase.

18. MATURITY STAGE
•1.SALES VOLUMES PEAK
•2. DECREASING MARKET SHARE
•3. PROFITS START TO DECREASE

19. SALES VOLUME PEAK
• After the steady increase in sales during the growth stage, the market starts to
become saturated as there are fewer new customers. The majority of the
consumers who are ever going to purchase the product have already done so

20. DECREASING MARKET SHARE
• ANOTHER CHARACTERISTIC OF THE MATURITY STAGE IS THE
LARGE VOLUME OF MANUFACTURERS WHO ARE ALL COMPETING
FOR A SHARE OF THE MARKET. WITH THIS STAGE OF THE PRODUCT
LIFE CYCLE OFTEN SEEING THE HIGHEST LEVELS OF COMPETITION,
IT BECOMES INCREASINGLY CHALLENGING FOR COMPANIES TO
MAINTAIN THEIR MARKET SHARE.

21. PROFIT START TO DECREASE
•While this stage may be when the market as a whole makes the most profit, it is
often the part of the product life cycle where a lot of manufacturers can start to
see their profits decrease. Profits will have to be shared amongst all of the
competitors in the market, and with sales likely to peak during this stage, any
manufacturer that loses market share, and experiences a fall in sales, is likely to
see a subsequent fall in profits. This decrease in profits could be compounded by
the falling prices that are often seen when the sheer number of competitors forces
some of them to try attracting more customers by competing on price.

22. DECLINE STAGE
• MARKET IN DECLINE
• FALLING SALES AND PROFITS
• PRODUCT WITHDRAWAL:

23. MARKET IN DECLINE
• During this final phase of the product life cycle, the market for a product will
start to decline. Consumers will typically stop buying this product in favour of
something newer and better, and there’s generally not much a manufacturer will
be able to do to prevent this.

24. FALLING SALES & PROFITS
•As a result of the declining market, sales will start to fall, and the overall profit
that is available to the manufacturers in the market will start to decrease. One
way for companies to slow this fall in sales and profits is to try and increase their
market share which, while challenging enough during the maturity stage of the
cycle, can be even harder when a market is in decline.

25. PRODUCT WITHDRAWAL
•Ultimately, for a lot of manufacturers it could get to a point where they are no
longer making a profit from their product. As there may be no way to reverse this
decline, the only option many business will have is to withdraw their product
before it starts to lose them money.

26. TYPES OF PRODUCT LIFE CYCLE
Our standard product life cycle goes through the
stages of introduction, growth , maturity and decline
as we can see with the diagram below. However not
all products follow the standard product life cycle and
will have a very short life or stay in the maturity stage
and not progress to the decline stage. One group of
product was divided into three categories by philip
kotler et al (principles of marketing 2008): fashions,
fads and styles.

27.  STYLE
A STYLE IS THE MANNER IN WHICH
A PRODUCT IS PRESENTED AND
CERTAIN STYLES COME AND GO.
THE CURRENT STYLE FOR MOBILE
PHONE IS TOUCH SCREEN AND
THIS STYLE WILL LAST UNTIL A
NEW TECHNOLOGY STYLE
APPEARS. SO THE SHAPE OF A
STYLE PRODUCT LIFE CYCLE IS
LIKE A WAVE, AS ONE STYLE
FADES OUT, ANOTHER APPEARS.

28. •FASHION
A fashion is a current trend or popular
style in a particular field. A fashion can
have a long or short product life cycle.
Certain clothing fashions last for a short
period and the product life cycle will
decline very rapidly, whilst others will
decline slowly or even turn into what is
known as a timeless classic product life
cycle.

29.  FAD
A fad is a product that is around for a
short period and is generated by type.
As you can see for a fad product sales
peak very quickly, as this product has a
very short product life cycle.
Sometimes a product may follow the
standard product life cycle but have one
stage of the product life cycle which has
a fad type of unusually high peak in
sales.

30. TYPES OF PRODUCT LIFE CYCLE
Our standard product life cycle goes through the
stages of introduction, growth , maturity and decline
as we can see with the diagram below. However not
all products follow the standard product life cycle and
will have a very short life or stay in the maturity stage
and not progress to the decline stage. One group of
product was divided into three categories by philip
kotler et al (principles of marketing 2008): fashions,
fads and styles.

31.  STYLE
A style is the manner in which a product is presented
and certain styles come and go. The current style for
mobile phone is touch screen and this style will last
until a new technology style appears. So the shape of a
style product life cycle is like a wave, as one style
fades out, another appears.

32. FASHION
A fashion is a current trend or popular style in a particular field. A
fashion can have a long or short product life cycle. Certain
clothing fashions last for a short period and the product life cycle
will decline very rapidly, whilst others will decline slowly or even
turn into what is known as a timeless classic product life cycle.

33.  FAD
A fad is a product that is around for a short period and
is generated by type. As you can see for a fad product
sales peak very quickly, as this product has a very
short product life cycle. Sometimes a product may
follow the standard product life cycle but have one
stage of the product life cycle which has a fad type of
unusually high peak in sales.