• thinkigcse.com

Product Life Cycle

A Product life cycle shows the different stages through which a product goes from development to decline.

Product life cycle graph

 

Introduction Stage

  • Product launched into the market.
  • Sales grow slowly.
  • Informative advertising is done.
  • Firm might not earn a profit at this stage.
  • Price skimming may be used if the product is new invention and has no competitors.
  • Competitive pricing may be used if it already has lot of competitors.

Growth Stage

  • Sales grow rapidly.
  • Persuasive advertising may be used.
  • Prices may be reduced if faced by stiff competition.
  • Firm starts earning profits.

 Maturity Stage

  •  Sales increase slowly and reach the highest sales figures.
  • Competition is at the maximum level as many new ‘me too’ products may be in the market.
  • Promotional pricing might be a good option.
  • Profits are at the highest level as the firm is also getting economies of scale.
  • Repetitive advertising is done to remind the consumers.

Saturation Stage

  • Sales are stagnant.
  • Maximum competition but no new competitors and the market is already crowded with the same types of products.
  • Promotional pricing or competitive pricing may be a good choice.
  • Advertising efforts at its highest point.

Decline Stage

  • Sales start to decline.
  • Profits start to come down.
  • Marketing research it done to find out whether this decline is permanent or temporary.  If the decline is permanent in nature then stop the production of the product, otherwise implement extension strategies.
  • Advertising is reduced.

Extension stage

  • Introduce new variations of the original product
  • Try to sell the product in different markets.
  • Make small changes in the colour, design or packaging
  • Start a new advertising campaign.
  • Add more retail outlets to boost sales.
 

 

 

Exciting News!

IMPORTANT MESSAGE

Quizzes and worksheets on this website have been developed in Flash format. Flash is no more supported by browsers. Therefore, you might see blank pages on some instances. Install Flash player plugin for Chrome from Chrome Web Store. Click here 

Similarly, for other web browsers you will have to activate the relevant flash player plugins.

JOIN OUR ONLINE COURSES

New Youtube Channel - ThinkIGCSE

Hi Everyone, I have launched a new YouTube channel with more than a 100 videos on  Economics and Business Studies, tailored specifically for IGCSE and A Level and IBDP students.

Subscribe now and join us on this learning journey: @thinkIGCSE

WHO'S ONLINE

We have 323 guests and no members online

MindMaps

PDF FILE

Download

Cheatsheets

PDF FILE

Download

Crosswords

PDF FILE

Download

Save
Cookies user preferences
We use cookies to ensure you to get the best experience on our website. If you decline the use of cookies, this website may not function as expected.
Accept all
Decline all
Read more
Analytics
Tools used to analyze the data to measure the effectiveness of a website and to understand how it works.
Google Analytics
Our website uses Google Analytics to understand how you interact with our site and improve your browsing experience. These cookies collect information in an anonymous form, including the number of visitors to the site, where visitors have come from, and the pages they visited. The data helps us analyze trends and user behavior to enhance our website's functionality and content.
Accept
Decline
Marketing
Set of techniques which have for object the commercial strategy and in particular the market study.
Marketing
Our website uses Google marketing cookies to deliver personalized ads and measure the effectiveness of our advertising campaigns. These cookies track your online activity to help us show you relevant ads on Google services and partner websites.
Accept
Decline