What is the Product Life Cycle? Why the Product Life Cycle is a concept closely related situation analysis and the marketing mix? The Product Life Cycle is a concept that describes the stages in which a product generates revenue. There are four stages in the product life cycle. The stages are the Introduction, Growth, Maturity and Decline. The Introduction stage is the used to create an awareness of the product and inform clients of the benefits of purchasing their particular brand.
At the introduction stage the product makes its first appearance and it is necessary for customers to be made aware of its arrival, and therefore a range of activities from within the promotion mix variable are used. Companies will often spend heavily on advertising at this stage, hoping that, as awareness increases, sales will grow. (Orin Miller, “The product life cycle and the marketing mix”, Credit Management, March 1, 2001) The Nintendo 3DS is in the introductory stage of the product life cycle. LG and HTC Smartphones are the handheld competitors of the 3DS system.
The second stage of the product life cycle is Growth. Rapid revenue growth is typical during this stage of the product life cycle. The customers are more aware of the product and its benefits and thus more customers are purchasing the product during this phase. The distribution of the product may be increased at this point in the product life cycle because of the demand. (www. netmba. com/marketing/product/lifecycle) The levels of promotional activity at this stage typically focus on expansion of the market into new segments.
The introduction of new sizes and flavors may be used to maintain this level in the product life cycle. www. mindtools. com/pages/article/newSTR_80. htm Chobani greek yogurt is a product that is currently in the growth cycle of the product life cycle. Several brands Fage and Yoplait greek yogurt are competitors in this section. The maturity stage of the product life cycle is the next stage of the product life cycle. The maturity stage is characterized with high profits. The increase of sales is evident at this stage yet they are at a slower pace.
The customers at this stage are knowledgeable of the product and advertising costs at this stage have been reduced. There are more competitors recognized in this stage and market share can be lost during this time. Companies try to prevent that loss by lowering price; emphasizing the differences in their brand; enhancing the product features; and even changing the distribution of the products. www. quickmba. com/marketing/product/lifecycle/ Tootsie Pops brand lollipops are currently in the mature stage of the product life cycle.
The manufacturers are introducing new flavors of lollipops often and gearing campaigns around customers choosing new flavors. The final stage of the product life cycle is the decline stage. During the final stage of the product life cycle the sales decline due to market saturation or changes in customer tastes. The price may be cut drastically and the products are faded out of production. Marketing spending and cost cutting may be used as a technique to create profit during this time. Newspapers are in the decline stage of the product life cycle.