What is a Product Life Cycle?
A product life cycle (PLC) is the period of time over which a product is developed, brought to market, and eventually removed from the market. All products have a limited life span and the product life cycle is a tool used to track a product’s performance over its lifetime.
Stages of a Product Life Cycle
The product life cycle has four main stages: introduction, growth, maturity, and decline.
Introduction
The introduction stage is the earliest stage of a product’s life cycle. During the introduction stage, a product is developed, tested and marketed. The product must be made available so that customers can purchase it. The goal of this stage is to develop a market for the product and to generate revenue.
Growth
The growth stage is the period of time when the product begins to gain traction in the marketplace. During this stage, sales will increase and the product will become more widely accepted. This is the most profitable stage of the product life cycle, as the cost of production is lower than the revenue generated.
Maturity
The maturity stage is the longest stage in the product life cycle. During this stage, sales will begin to level off and the product will start to become saturated in the marketplace. The goal of this stage is to maintain market share and to generate as much revenue as possible.
Decline
The decline stage is the final stage of a product’s life cycle. During this stage, sales will begin to decline and the product will become obsolete. The goal of this stage is to reduce costs and to maximize any remaining profits from the product.
Examples of Product Life Cycle
- The introduction of the iPhone in 2007
- The growth of the iPod in the late 2000s
- The maturity of the DVD player in the early 2000s
- The decline of the VCR in the late 2000s
The product life cycle is an important concept for businesses to understand as it can help them plan for the future of their products and make better decisions about how to manage them. By understanding the different stages of the product life cycle, businesses can better predict how their products will fare in the marketplace.