Essay On Product Life Cycle

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Product life cycle “describes the various phases a product goes through from when it was initially thought of until it is removed from the market. Some products reach the final stage of the product life cycle” The product life cycle has five stages they include: Product development, Introduction, growth, maturity and the decline stage. Product development Stage- the firm finds and develops a new product idea. At this stage, there are no sales and the firm’s cost mounts. Introduction Stage- begins when a new product is launched. Introduction takes time and sales growth is likely to move at a slow pace. Profits are negative or low as a result of low sales and high distribution and promotion expenses. Finances are needed in order to attract distributers…show more content…
Modifying the marketing mix- A firm can improve its profits by modifying one or more elements of the marketing mix. For example, a firm can decrease its prices in order to attract new customers as well as its competitor’s customers. It can launch a better advertising campaign or a firm can utilize aggressive sales promotions. Decline stage- both sales and profits decrease. Sales decrease as a result of technological advances, changes in consumer taste, increase in competition, new legations and so on. It can be very expensive for a firm to have a weak product. The marketing strategies that firms can use at this stage includes: maintain, harvest or drop its product. A firm may maintain its product, repositioning or reinvigorating it hoping that the product will move back to the growth stage. Firms may decide to harvest (this is where firms reduce cost) their products. Examples of cost that firms may reduce include: research and development, advertising and plant and equipment cost. Harvesting may increase a firm’s profit in the short run. A firm can decide to drop a product by selling it to another company or liquidate it at salvage

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