The document discusses the product life cycle model which outlines typical stages of introduction, growth, maturity, and decline that products go through over time. It notes benefits of the model for resource allocation and strategy choice but also criticisms that patterns can vary and changes may be unexpected. Key aspects of each stage are identified such as types of customers, competitors, issues faced, and common strategies used.

1. PRODUCT LIFE CYCLE

2. Stages of the Product Life Cycle Time Sales Intro- duction Growth Mature Decline

3. Other Shapes of the Product Life Cycle

4. Benefits of Predictability Resource allocation Choice of strategy Timing

5. Criticism of the Product Life Cycle Patterns are too variable Unexpected changes Self-fulfilling prophecy

6. Sales Low Rising Peak, Flattening Declining Cost Highest Average Lowest Depends Profits Negative Rising Higher Declining Intro Growth Mature Decline

7. Customers Innovators Early Middle Laggards Adopters Majority Competitors Few Growing Many Few Intro Growth Mature Decline

8. Introduction Stage ISSUES Supply side Technological leap-froging Assume industry-wide start-up costs Demand side High uncertainty in market size High uncertainty in market tastes

9. Introduction Stage STRATEGIES Market pioneers Very risky Need financial resources The “bleeding edge” Pricing Skimming Penetration

10. Growth Stage STRATEGIES Early followers Options Imitate Innovate Differentiate

11. Maturity Stage ISSUES Technical certainty Initial costs covered High fixed costs Experienced, well-informed buyers Replacement sales greater than initial sales Commoditization

12. Maturity Stage STRATEGIES Pioneer new segment Head-to-head competition with leader Low cost strategy Catch leader asleep

13. Decline Stage STRATEGIES Reasons for decline In order... Maintain Harvest Drop