Now that you have read our recent blog about the extended marketing mix, we mentioned that one of the Ps is Product and that this is would the physical item or service that you offer, but have you ever thought about how to get the product in the market and where you should begin? This is where the product life cycle comes in.
In this blog, we will be looking at the 4 stages of the product life cycle and how you can use this knowledge for your own business to sell your products.
Before we jump in, what is the product life cycle? It is a model which describes or predicts the stages a sales growth that a product will go through from the moment it is developed and launched onto the market all the way until the end of its life. It is an extremely useful model because it comes in handy for doing things like forecasting sales trends of the product over its life, assessing where the product or brand is in terms of its stage of its lifecycle and where it fits in in the product portfolio. It also helps with determining how to target and how to position the product in a market.
There are 4 stages in the Product Life Cycle which are:
We begin to look at the Introduction, as the word states, this is introducing the product to the market. You start by looking into the product development establishment and patent protection, meaning that you ensure that you are protecting your product against copyright. You would also research on how you would price your product against the cost and revenue, as a result conducting a price analysis to ensure you can identify the correct pricing to ensure you get what is needed for your business, i.e profit. Once you understand this, you can introduce your product to the market and, at first, it can be very difficult to garner sales.
Of course, a product that is thoroughly tailored to your target audience needs is more likely to succeed! As a result, you would need to ensure that efficient research is done in order to better understand you audience and increase the likelihood of garnering sales and moving onto the next stage of the lifecycle.
Once your product is garnering leads and sales, you move onto the Growth stage. This is where you look at increasing in your market share and also be able to see more and quicker sales as your target audience become familiar with your product. As a result, you would need to make sure that you are maintaining the quality of product.
As the market grows, you profit would increase but it would attract more competitors, so they may choose to copy your product. Therefore, you need to ensure that you observe the demands and competition to ensure your product continues to make sales. You can do this by promoting your brand and expanding your distribution outlets if it is demanding in order to expand your target audience.
Moving onto the Maturity stage, this is where the sales growth decreases as newer competitors join the market and it becomes increasingly difficult to maintain market share. If you have a higher market share, however, you would be able to see high profits.
With weaker competitors beginning to leave the market, this stage can have a positive outcome in which you would need less investment and marketing making it easier to enjoy the profitable sales. This would be done by being able to maximise the return so identify if the product needs any changes that could help with garnering new sales.
Then at the final stage, the Decline stage. This is when the sales begin to decrease at the competition continues to increase and a lot of the competitors begin to leave the market. You would also see that no more profit is gained. As a result, it is important that at this stage that you have, if not already, lowered the cost of the product and use loyalty schemes to ensure that your customers continue to stay with you and discover your other products. You can either discontinue the product if it has gone out of trend or continue to produce the product but at a smaller scale as old trends could revive interest to the product.
As you can see, the product life cycle is a when creating your marketing strategy as it allows you to make important decisions on advertising, budgets, product prices, and packaging. It also allows you to better understand the marketing mix, what steps to take and how you can use these strategies to improve the chance of getting leads, conversions and eventually sales.
Having a great marketing strategy in place is key to the success of any business!
Did you find this blog helpful? If so, please do call us today on 01923 823577 and let us help you with building your business to become a successful brand!