Stages of the product life cycle:
- Introduction: The product is launched/released onto the market.
- Growth: If the launch is successful sales will increase quickly and the product may make a profit for the first time
- Maturity: Sales growth slows down, but repeat purchases still happen and customers start becoming loyal. The market becomes saturated as competitors introduce competing products
- Decline: Eventually the product is outdated and there is a big fall in sales, leading to the withdrawal of the product
Businesses can increase the life of a product using extension strategies. This involves changing the product slightly so that it has a new appeal to the target market or appeals to a new market segment. For example: Apple does this by bringing out new models of the iPhone and iPod.
Product Portfolio Analysis
Businesses sell a range of products. This is called the Product Mix or Product Portfolio. New products are regularly launched onto the market. Product Portfolio analysis allows a business to make…