Every product has a limited life cycle that passes through different stages - introduction, growth, maturity, and decline. At each stage, sales, profits, and the appropriate marketing strategy differ. In introduction, sales are low but prices are high as costs are also high. In growth, sales rapidly rise as more customers are attracted. Maturity sees a slowing of growth until sales eventually decline. During decline, companies withdraw products or focus on reducing costs and prices to extract remaining value. The optimal marketing strategy changes for each phase, focusing on promotion in early stages and modification or reduction in later stages.

1. PRODUCT
LIFE
CYCLE
Rishabh Kaushik
1006447089

2. WHAT IS A PRODUCT?
A PRODUCT is anything that can be offered
to a market usually to satisfy a want or need

3. CATEGORIES
There are 4 general categories of ‘products’ that are
marketed:
• Goods
• Services
• Places
• Persons

4. PRODUCT LIFE CYCLE
• Every PRODUCT has a life cycle and asserts four
things about a PRODUCT
 PRODUCTS have a limited life
 PRODUCT sales pass through different stages each
posing different challenges, opportunities n problems to
the seller
 Profits rise n fall at different stages
 PRODUCTS require different marketing, financial,
purchasing strategies at each stage

5. Product Life Cycle....
No of
sales
Maturity
Saturation
Decline
Growth
Launch /
Introduction
Research &
Development (R&D)
Time line

6. PRODUCT LIFE CYCLE......
RESEARCH AND DEVELOPMENT PHASE
•
•
•
•
Begins when the company develops a new-product idea
Sales are zero
Investment costs are high
Profits are negative

7. PRODUCT LIFE CYCLE......
INTRODUCTION PHASE
•
•
•
•
•
Low sales
Prices tend to be high because costs are high
Negative profits
Innovators are targeted
Little competition

8. PRODUCT LIFE CYCLE......
GROWTH PHASE
•
•
•
•
Sales rapidly rise
Prices remain where they are, or fall slightly
Rising profits
Promotional expenditure may increase or decrease
depends upon competition
• New customers also start buying
• Growing competition

9. PRODUCT LIFE CYCLE......
MATURITY PHASE
• Usually lasts longer than previous stages
• Divided into three phases:
1. Growth-sales growth rate starts to decline
2. Stable-sales flatten because of market saturation
3. Decaying maturity-the absolute level of sales begin to
decline and customers start switching to other products

10. PRODUCT LIFE CYCLE......
DECLINE PHASE
•Sales and profits decline
•Some companies withdraw their products from market
•Those remaining reduce number of products
•High prices on spare parts
•Focuses on cost reduction

11. MARKETING STRATEGY
INTRODUCTION PHASE
• Rapid-skimming strategy (high price/high promotion).
• Slow-skimming strategy (high price/low promotion).
• Rapid-penetration strategy (low price/high promotion).
• Slow-penetration strategy (low price/low promotion).

12. MARKETING STRATEGY
GROWTH PHASE
• Improve service quality and add new service features and
elements
• Enter new market segments
• Use new channels of distribution
• Lower prices to attract more price-sensitive customers
• Shift from product awareness advertising to productpreference advertising

13. MARKETING STRATEGY
MATURITY PHASE
1.
Market-modification strategy
• Increase frequency use by current consumers
• Look for new target market
1.
Product-modification strategy
• Quality improvement
• Feature improvement

14. MARKETING STRATEGY
DECLINE PHASE
•
•
•
•
Reduce cost
Reduce price
Phase out weak items
Include special offers