Product Life Cycle As A Strategic Marketing Tool
1. Introduction ? What Product Life Cycle is about The Product Life Cycle (PLC) is a theoretical concept, which put forward that any product idea will go through different stages from beginning to the end. PLC is typically divided into 4 stages and could be illustrated by a bell-shaped curve (see figure 1). The stages are, namely: · Introduction · Growth · Maturity · Decline Total sales of the product vary in each of the 4 stages. They move from zero in the introduction stage to high at maturity and then back to low in decline stage. Profit will not appear until towards the end of introduction stage when most of the costs for product development are recovered.
PLC can be used to refer to a product category or industry, a particular product brand, and even fashion, music or fads. Of course one thing we need to bear in mind is that PLC curve exhibits different shapes and length for each of the above situations. Product categories or industries tend to have the longest life cycles and their stages of growth and maturity last longer, relative to those of a product brand. As for extreme cases of fads, PLC is short and the curve shows a sharp growth and sharp decline.
In the following discussion, we will examine several examples to demonstrate how PLC serves as a useful marketing tool to indicate certain marketing strategies to be adopted for products identified in the various stages of PLC.
2. The truth of PLC as a useful tool ? How? As products will experience different characteristics relative to the market and competition in the various PLC stages, they call for distinct marketing objectives and strategies in order to maximize return and optimize efficiency.
Looking at the 4 PLC stages: A. Introduction In this stage, sales are low as a new product is first introduced to a market. For sure customers aren?t looking for it and may not be aware of its benefits over current offerings or solutions. In fact, they may not even know about it and have the need for it.
PLC can be used to refer to a product category or industry, a particular product brand, and even fashion, music or fads. Of course one thing we need to bear in mind is that PLC curve exhibits different shapes and length for each of the above situations. Product categories or industries tend to have the longest life cycles and their stages of growth and maturity last longer, relative to those of a product brand. As for extreme cases of fads, PLC is short and the curve shows a sharp growth and sharp decline.
In the following discussion, we will examine several examples to demonstrate how PLC serves as a useful marketing tool to indicate certain marketing strategies to be adopted for products identified in the various stages of PLC.
2. The truth of PLC as a useful tool ? How? As products will experience different characteristics relative to the market and competition in the various PLC stages, they call for distinct marketing objectives and strategies in order to maximize return and optimize efficiency.
Looking at the 4 PLC stages: A. Introduction In this stage, sales are low as a new product is first introduced to a market. For sure customers aren?t looking for it and may not be aware of its benefits over current offerings or solutions. In fact, they may not even know about it and have the need for it.
References: 1. Marketing Management (International Edition), 10th Edition ? Author: Philip Kotler; Publisher: Prentice Hall International, Inc. 2. What makes winning brands different ? Authors: Andreas Buchholz, Wolfram Wördemann; Publisher: John Wiley & Sons, Ltd. 3. Essentials of Marketing ? Authors: Perrault, William D. Jr., E. Jerome McCarthy; Publisher: Chicago Richard D. Irwin Company