Product Lifecycle

Product lifecycle refers to the stages a product goes from its initial introduction to the market until it is eventually discontinued. Understanding these stages helps businesses make informed decisions about marketing, pricing and product development.

The stages of product lifecycle

1. Development: This is the research phase before a product is introduced to the market. It involves idea generation, prototype development and testing. No revenue is generated during this stage.

2. Introduction: The product is launched into the market. Marketing efforts are high to create awareness. Sales grow slowly as customers start to adopt the product. This stage often involves high costs and low profits.

3. Growth: The product gains acceptance and sales increase rapidly. Profits begin to rise as economies of scale are achieved. Competitors may enter the market during this stage.

4. Maturity: Sales peak and then stabilize. The market becomes saturated, and competition is intense. Profits may start to decline due to increased marketing expenses and price competition.

5. Decline: Sales and profits decline as the product becomes outdated or less popular. Companies may decide to discontinue the product, sell it off or innovate to extend its lifecycle.