The product life cycle has four main stages: introduction, growth, maturity, and decline. During the introduction stage, the objective is to attract early adopters with strategies like rapid or slow skimming. In the growth stage, competition increases and strategies focus on expanding distribution and product lines. The maturity stage sees sales and profits stabilize as the market becomes saturated. In decline, sales decrease due to factors like new technologies, and strategies aim to cut costs or terminate the product.

1. Product life cycle
Production Management

2. According to Willian J. Stanton
 “from its birth to death, a product exists in
different stages and in different competitive
environments. Its adjustment to these
environments determines to great degree just
successful its life will be”

3. Characteristics Stages in Life Cycle
Introduction Growth Maturity Decline
Objective Attract innovators and Expand distribution and Maintain differential Cut back, revive, or
opinion leaders to new product line advantage as long as terminate
product possible
Industry Sales Increasing Rapidly increasing Stable Decreasing
Competition None or small Some Substantial Limited
Industry Profit Negative Increasing Decreasing Decreasing
Customers Innovative Affluent mass mrkt Mass mrkt Laggards
Product mix One or two Basic Expanding line Full product line Best sellers
models
Distribution Depends on product Rising no of outlets Greatest no of outlets Decreasing no of
outlets
Promotion Informative Persuasive Competitive Informative
Pricing Depends on product Greater range of prices Full line of prices Selected prices

4. Strategies in different phases of PLC
 Introduction phase: this phase marks the launch
of the product.
 According to P.Kotler, management can pursue
one of the four strategies on the basis of high low
price and promotion.
1. Rapid skimming strategy
2. Slow skimming strategy
3. Rapid penetration strategy
4. Slow penetration strategy

5. Rapid skimming strategy
 This strategy of high price and high promotion
works effectively only when the customer
awareness for the product is not very high, or
those who are aware, willingness to pay any price
to possess or buy it is high.
 Here the marketers want to cover the cost as
much as possible during the launch phase of
gather product.
 This strategy also works when the market size for
the product is large and the threat from
competition is imminent.

6. Slow skimming strategy
 This is based on the assumption that the firm has
sufficient time to recover its pre-launch expenses.
 Here the company launches the product at high
price but spends lesser money on the promotion.
 The resultant profitability is more as company is
able to charge higher price but the marketing
costs are lower.
 This happens when the technology being used by
the firm is highly sophisticated and competition
will have to invest substantial resources to get
this technology.

7. Rapid penetration strategy
 This is based on same assumption and
environmental conditions as the ones mentioned
under the rapid skimming.
 The only difference between rapid skimming and
penetration is the firm’s long term objectives
 Here they charge low price and spends heavily
on the promotional efforts
 If the objective is marked share and profit
maximization in the long run and intensive
competition or other entry barriers characterize
the market, a firm may choose to enter the
market with this strategy.

8. Slow penetration strategy
 This delivers result when the threat from
competition is minimal, market size is large,
market is predominantly price sensitive and
majority of the market is familiar with the product.
 Here, the company launches the new product at
lower price, and low promotional efforts and
expenditure.
 The lower price enables the company to
penetrate the market whereas the low
promotional costs enable the company to have
better profitability.

9. Growth phase
 The introduction phase is indeed the most crucial
one, because more than 95% of products fail at
this phase.
 The 5% of lucky products that enter the growth
phase meet with a more strengthened and
increased competition.
 This competition now offers greater choice to the
customer, in the form of different product
types, packaging and prices.
 The market base expands as more customers
come in to buy the product .
 more trade channels are now willing to keep the

10. According to P.Kotler
Strategies is adopted to sustain the market growth
as long as possible.
1. Improve products quality.
2. Add new product features and improved styling
3. Enter into new market segments.
4. Enter into new distribution channels.
5. Reduce the prices to attract buyers.
6. Increase promotional activities.

11. Maturity phase
 Most products that survive the heat of competition
and even customers approval enter the maturity
phase .
 This phase is characterized by slowing of growth
rates of sales and profits .
 in fact, a decline in profits seems to appear now
 It tends to narrow down towards price and
promotion war

12. For an effective management, the marketing
manager should:
1. Improve the quality of the product
2. Give proper attention to increase the usage
among the current customers
3. Try to convert non-users into users of the
product that is, creating new buyers
4. Give proper emphasis to advertisement and
promotional programmes
5. Try to discover new uses for the product.

13. Decline stage
 Most crucial phase
 Sales may decline for no of reasons – technical
advances, arrival of new products at low cost,
changes in fashion, consumer preference etc.
 If the substitutes are more attractive and in latest
fashion, buyers may turn their eyes towards
them.

14. According to Stanton
 Improve the product in functional sense.
 Make sure the marketing and production
programmes are as efficient as possible.
 Streamline the product assortment by pruning out
unprofitable sizes and models. Frequently this
tactic will decrease sales and increase profits.
 “run out” the product that is, cut all costs to the
bare minimum level that will optimize profitability
over the limited remaining life of the product.
 Abandon the product.