The document outlines the four stages of a service life cycle: introductory, growth, maturity, and decline. The introductory stage involves small-scale launches of new services with few competitors. The growth stage sees rapid industry expansion and emerging market segments. During maturity, sales level off amid intense competition. Finally, the decline stage is marked by falling sales and profits due to new technologies or decreased demand.

2. Stages of Service Life Cycle
Maturity
Decline
Growth Stage
Introductory Stage

3. Introductory Stage:
New service or new form of current service is in the
introductory stage when offered first time.
Can be introduced on a small scale and expanded if
acceptance grows
Small scale introduction reduces financial risk
New services faces few or no direct competitors
Introductory stage normally short
Strategy to ensure new service accepted by consumers
is to have users of current service participate in new
service design.

4. Growth Stage:
Industry growing rapidly
Firms seeing positive cash flow
Industry is expanding and demand is high – firms
offering service can normally increase their prices –
higher margins and greater profits.
Thus more firms enter the market.
Distinct market segments emerge
Service providers need to develop a sustainable
competitive advantage.

5. Maturity Stage:
Sales level off.
Competition becomes very intense – intense
competitive advantage required – results in overall
industry profits.
Weaker firms will be shaken out of the industry.
At this stage in service life cycle, consumers see very
few distinguishable characteristics among the various
firms in a service industry.
Requires strong marketing program

6. Decline stage:
Industry sales decline – because of new technology
development
Because of decrease in demand – many companies
delete the service reducing competition
Cash flow and profit for companies throughout the
industry have declined.
Companies with the services in decline part of life cycle
have five options : Divest, harvest, Prune, Reentrench
or rejuvenate.

7. Decline stage:
Industry sales decline – because of new technology
development
Because of decrease in demand – many companies
delete the service reducing competition
Cash flow and profit for companies throughout the
industry have declined.
Companies with the services in decline part of life cycle
have five options : Divest, harvest, Prune, Reentrench
or rejuvenate.