(Last Updated On: June 2, 2017)
Product Life Cycle Stages
Product Life Cycle Stages, plays and important part in the product management. What is a product life cycle? Why companies should know their product life cycle? There are different stages in the life for a product. Different products available in the market, as you can see that companies are trying to make new and unique products according to the customer needs.
What is Product?
A product is an item, idea or a service which a company or a person sells to customers and client and get revenue through this. Goods have a physical presence; you can touch them in the sale of goods ownership transfer from seller to the customer (Boundless, 26 May 2016). Services do not involve the physical good (Boundless, 26 May 2016). The idea is an intellectual property of someone, which have commercial value. There are no service or goods involved in it, for example, patents, industrial processes, and appellations. (Boundless, 26 May 2016).
There is two type of products found in the market.
Tangible products involved physical presence for example building, gadget or vehicle. Most of the products in the market are tangible the best example here is soccer ball (Boundless, 26 May 2016).
Intangible products don’t have a physical presence for example services or ideas.
A product comes into the market through different stages and after that product will become outdated and replaced by other new products by the competitors (Admin, March 2016). There are following different stages involved in a products life cycle are;
In this stage, Research and development carried out by R&D department of a company. Different experiments carry out by the department to find out the best features for their new product to get the competitive advantage in the market (Admin, March 2016).
In the phase, the new product is launched, this stage is very expensive because the sale value is very low but on the other hand marketing cost is very high to get the market share (Admin, March 2016).
In this stage, the sale of the product is rising and company earning profit through economies of scale in production. The company is investing in marketing for getting more sales (Admin, March 2016).
Now the product sale reached its maximum and now the company will try to hold this market share for the longer period of time to earn a huge amount of profit (Admin, March 2016).
At this stage the product sale falling down, company stop marketing of this product and stopped production of new units (Admin, March 2016).
The market is now become global due to advancement in technology, so the competition is very high in the market. The life of the products is very short and companies have to cover their cost during a short span of time. The products with long life cycle will get the more advantage over its competitors. Unique products with better quality will attract the customers.