Stages in the Product Life Cycle

After developing a new product, it will be introduced into the consumer market. Investments need to be made on advertising and other promotional channels to build up customer awareness. Profits

The competitors can try to make a distinctive product or release the improved version of the firm’s product.

Many companies are able to rise to the top of their market to become first in class for their product. There are times when a product or the company that has created and established a first in class product begins to achieve a steady market share. At this point in time, many companies have decided to take advantage of their success and expand their existing product line to enhance a new market. One example would be for Coke to begin selling a new flavor of their

In the 1950s, the product life cycle theory was introduced to explain the expected life cycle of a product from design to obsolescence, a period of time divided into four stages: introduction, growth, maturity, and decline. As the world moves away from usage of oil to renewable and clean energy, it leads some to believe that oil is on its final stage of decline. However, it is important to remember that oil is more than a product, it is a natural resource making it a special case. Critics of the product life cycle theory bring up valid points. First, there is no set amount of time that a product must stay in a certain stage. Oil could remain at maturity for a significant period of time. This also means that the declining stage could be as long as the resource exists. Second, there is no real proof that all products must die. There have instances that products have gone from maturity back to a period of rapid growth thanks to some improvement. OPEC must bank on the critics being right in order to maintain its power as a cartel. TechInsider of November 5, 2015 predicts fossils fuels will be obsolete by the earliest 2050. Unfortunately, with the amount of global conflict this prediction will probably not be accurate. In terms of strategic action, OPEC needs to act swiftly and quickly as if they do not adapt they will become obsolete. Strategies they can implement are internal conflict resolution, research & development, organizational restructuring, and external negotiation.

INTRODUCTION Organizations market a mix of products or services or both. These constitute the offering that is made through the strategic window. Central to the success or failure of a business is the health of its product (or service) mix. A starting point is the product life cycle concept. This is a useful conceptual framework within which to study how firms can vary their marketing strategies—though of course as we shall see in later chapters they do have to take other factors into account. There seems to be little doubt, however, that at different stages in the product life cycle certain marketing strategies seem to be more appropriate than others. The life cycle concept also points to the different

A product has a certain life cycle in stages, the first stage is the introduction phase the product’s sales grow slowly, and the profit will be small because of heavy promotion cost, the second stage is the growth stage the sales will increase rapidly as the product becomes popular. At this stage profits begin to grow, but there will be competition in the market. Thirdly, is the maturity phase here the product is well known, at this point the promotional spend reduces and production economies of scale become established. By this time competitors will almost certainly have entered the market. Finally, is the decline phase product is losing market share and profitability rapidly. At this stage the marketer must decide whether its worth to support the product for a little longer or it should be left to disappear.

Market penetration is an expansion strategy in business, whereas it chooses to market current products in the market it has been utilized. Nonetheless, businesses utilize this strategy, whereas the only way to innovate is to use existing products which would increase market share, corresponding to the commentary on "Growth Strategies" at gaebler.com. Additionally, the dollar sales a business control within a certain market, plus the percent of units is the market share vs. all other competitors. Notwithstanding, one way to increase market share is by lowering prices. To demonstrate, in the markets where there is inconsequential differentiation among products, a lower price may help a business increase its share of the market (Suttle, R, n.d.).

Introduction Stage – This stage of the cycle sees the manufacturer conceptualizing its products and submitting it to the market. This, being done with the common business understanding of meeting the demands of the consumer’s requirements, calls for the manufacturer to devise products that are of high quality to enable it to equally compete in the existing market (Grantham, 1997). Likewise, in as much as the product has to be of equal standards to those already in the market, the manufacturer have to ensure that its price range is equally affordable if not cheaper than the products in the market. Done with the intention of enabling an organization realize profit in the highest level possible, the manufacturer has to keep in mind that upon its inception into the market, the product could be the most expensive to be launched (Hedden, 1997). The challenge associated with introduction does not guarantee an organization a market position and as such, its market might be in its minimal, translating to the fact that its sales will be low upon introduction and increase as the product gets familiarity with consumers in the market (Kumar, Sameer, and William, 2005). An example of such a product is the 3D television sets.

The classic model of a product life cycle has four basic stages: Introduction, Growth, Maturity and Decline. These cylces may be mitigated by product extensions, etc. in the case of a child's bed, utilizing new themes could continually place part of the line extension back into the growth market to maturity instead of allowing the whole line to decline. The various stages of the cycle are often explained as:

Growth stage - In this stage, sales and profits start to grow as company gains economic scale of production and marketing.

A product is like a person. It is born, grows up, matures and then passes away. The product life cycle discusses the stages which a product has to go through since the day that is comes out to the day that it is taken off the shelf. However, the difference between a human dying and a product is that the product is killed by someone. Either the company or by competition. There are several products in the market that have been around forever and there are ones that don’t make it very long. That is why the Product of Life Cycle comes in four stages.

Consider like a good start. Presenting a new product to the market is not just described as selling and promoting. Certainly, launching a new product needs more than just that, in orders to be highly demanded by customers. Another things also contribute to making a great product: dedicated employees, good strategy, decent information systems, excellent implementation, in special when it comes to introduce a new product to a highly developed market. That is where marketing should be used, as nowadays, successful companies at high levels have one thing in common – they have strongly customers focused and heavily committed to marketing.

Product life cycle has one of the most attractive and central concept in marketing theory and practice. Today, it is one of

New competitors entering a certain segments of the market, can add new production capacity and a lot of resources, and fight for market share. The key lies in wether the new competitors can easily enter the fine market. This is the mainly due to the economies of scale, channel construction, the expected revenge factors.

The product life cycle should also be considered. The life cycle of a product includes its introduction to the market, growth, maturity and final decline. New goods should make more use of promotion since the marketers would want people to know that that product is on the market. During the growth stage promotion efforts should be even more vigorous due to the fact that competition has entered the picture. When the product has matured competition has probably stabilized and its consumer demand has decreased this is when marketers should use elements of the promotion mix such as advertising to remind or reinforce consumers attitudes about the product. The decline stage of the lifecycle marketers should set a much smaller promotion budget so as to secure all possible profit (Bennett, 1988, p.521).