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Product life cycle

Posted in Business studies, The marketing mix

The product life cycle describes the life of a product - from the day it first goes on sale to when it's finally withdrawn from sale. Here is a typical product life cycle:

Product life cycle

The Y-axis shows the sales of the product and the X-axis the time.

The product life cycle can be split into 5 sections (as shown on the graph):

  • Introduction - the initial launch of the product, sales will be slow and costs high.
  • Growth - sales start to increase as the product increases market share.
  • Maturity - growth in sales starts to slow until they eventually level out at a constant rate
  • Decline - sales begin to fall as new technology is released or consumer trends change.
  • Withdrawal - the product is eventually withdrawn from sale completely

The length of a products life cycle can vary - from weeks (fashion) to centuries (beer, bisto, tobacco)

Extension strategies

In order to prevent the decline of sales or even initiate more growth in sales a business may employ an extension strategy. These can include:

  • Attracting a wide audience - attracting customers who wouldn't usually buy your product to do so
  • Alter the product - just changing the colour and style of a product can prevent a decline in sales
  • Sales promotions - for example offering 50% extra free in food products

Different types of product life cycles

Some products do not follow the 'classic' life cycle curve - some products will fail whilst others will use multiple extension strategies.