Product Life Cycle

A product life cycle is essentially the life of the product on the market or, in other words, the duration of the product's existence for consumers – from the first moment it was presented to them to the moment of its demise.

The product life cycle has four stages – introduction, growth, maturity, and decline. Each of these stages gives recommendations to the business, or specifically to the marketing team that is responsible for advertising and promoting the product, on how to manage the product or service under certain conditions. The process of managing the product in different stages of its life cycle requires corresponding measures for keeping it profitable as long as possible. This process is otherwise known as the product life cycle management.

At some point the product inevitably becomes irrelevant, outdated, or incapable to compete with the new analogues. That is the last stage of the product's decline and eventually its demise. So, the new products take the place of the old ones as a matter of fact. That’s what makes the market an ever-changing and competitive sphere.

Product Life Cycle stages

Let’s consider either stage of the product life cycle particularly:

1. Introduction. The product begins with an idea. However, not every idea is worth producing and advertising, because it potentially can be unpopular, unprofitable, or unrealistic. The research and development (R&D) department can solve this problem and filter the flow of ideas. If the idea is feasible, then it will be produced and set out on the market. The marketing team will promote it and increase the recognizability of the product through the marketing campaigns.
2. Growth. If the product or service gets successful and gains the attraction of the consumers, then it’ll face the next stage of its cycle – the growth. The demand for the product increases, therefore increasing the product production and expansion. In general, the quantity and availability of the product grow alongside the consumers’ demand.
3. Maturity. It’s the most profit-making stage when the demand is high and the production costs are low. In order to prolong the product life cycle the company can differentiate the product or extend it to other items. For example, Coca-Cola extends its original beverage to different versions, e.g., a Vanilla or Cherry Coke. Note, that this differentiation shouldn’t necessarily be significant. The minor changes can improve the product, and at the same time, save its uniqueness.
4. Decline. The competition on the market grows in addition to the popularity of the product. Eventually, the product can be pushed out of the market by the new ideas. This stage refers to the moment when the product leaves the market. This option is better than running the business at a loss and maintaining something that doesn’t work anymore.

The knowledge of these stages and their peculiarities can help the businessman to create a profitable product and maintain it for a long time. However, there are a lot of risks, considering that many ideas fail on the first stage of their existence. Usually, that happens after the research, production, and promotion of the product, and costs money and effort. Thus, not many companies are ready to take the risks of inventing something new. One of the safest strategies is to wait and see the other companies’ actions, and if they’re successful, create an analogue of their product. Nevertheless, the invention of a new item can lead you to incomparable success. The risks can be reduced by attentive studying and monitoring the product life cycle and market conditions.

Product Life Cycle example

Continuing the example of Coca-Cola, let’s try to define briefly all the aforementioned stages of the product life cycle:

1. The introduction of the product happened in 1886. Probably, the research of the idea had shown a good profit potential.
2. The growth of the brand had been happening for 10 years. By that time Coca-Cola had been presented in every state of America, providing the demand for the product.
3. The maturity has started long before now, but the product is still at this stage. The company is internationally presented and recognized. Its profits are significant and the manufacture is stable. Also, the brand differentiates the product and keeps it up to date. 
4. The decline is the next stage that the product hasn’t gotten to yet due to effective product life cycle management.