Product Life Cycle

Click to edit Master Marketingstyle subtitle Strategies

Sujith Nair Vishnu Mohan

Product life cycle

product life cycle is the course of a products sales and profits over time.

product life cycle(PLC) deals with the life of a product in the market with respect to business or commercial costs and sales measures.

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Products have a limited life. Products sales pass through distinct stages, each posing different challenges, opportunities and problems to the seller. Profits rise and fall at different stages of the product life cycle. Products require different marketing, financial, manufacturing, purchasing, and human resource strategies in each life cycle stages.

Product life cycle

1.Market introduction stage 2.Growth stage 3.Maturity stage 4.Saturation and decline stage

Product life cycle

Market introduction stage

Characteristics costs are very high slow sales volumes to start little or no competition makes no money at this stage

Product life cycle

Objective : Create product awareness

Strategies

Low price Selective distribution Create product awareness Heavy product awareness Demand has to be created Customers have to be prompted to try the product

Product life cycle

2.Growth stage Characteristi cs Costs reduced due to economies of scale Sales volume increases significantly Profitability begins to rise Public awareness increases Competition begins to increase with a few new players in establishing Increased competition leads to price decreases

Product life cycle

Objective : maximize market share Strategies Product extensions Intensive dealerships Reduce promotion /offers Mass market awareness Better service

Product life cycle

3.Maturity stage

Characteristics Costs/customer are lowered as a result of production volumes Increase in profit Sales volume peaks and market saturation is reached increase in competitors entering the market Prices tend to drop due to competing products Brand differentiation and feature diversification is emphasized to maintain or increase market share Industrial profits go down

Product life cycle

Objective :Maximize profit Strategies Diversify brands Matching price to competition Intensive distribution Strategies to avoid brand switching Kill competition

Product life cycle

4.Saturation and decline stage

Characteristics

costs become counter-optimal sales volume decline prices, profitability diminish profit becomes more a challenge of production distribution efficiency than sales

Product life cycle

Strategies Leave weaken products Cut down price New strategies for promotion