Marketing Through the Product Life Cycle 171
MARKETING THROUGH THE PRODUCT LIFE CYCLE
In today’s highly dynamic marketing environment, a company’s marketing strategy
must change as the product, market, and competitors change over time. Here, we
describe the concept of the product life cycle (PLC) and the changes that companies
make as the product passes through each stage of the life cycle.
The Concept of the Product Life Cycle
To say that a product has a life cycle is to assert four things: (1) Products have a limited
life; (2) product sales pass through distinct stages with different challenges, opportu-
nities, and problems for the seller; (3) profits rise and fall at different stages of the
product life cycle; and (4) products require different marketing, financial, manufac-
turing, purchasing, and human resource strategies in each stage. Most product life-
cycle curves are portrayed as a bell-shape (Figure 3-11).
This PLC curve is typically divided into four stages:^20
➤ Introduction:A period of slow sales growth as the product is introduced in the
market. Profits are nonexistent in this stage because of the heavy expenses incurred
with product introduction.
➤ Growth:A period of rapid market acceptance and substantial profit improvement.
➤ Maturity:A period of a slowdown in sales growth because the product has achieved
acceptance by most potential buyers. Profits stabilize or decline because of
increased competition.
➤ Decline:The period when sales show a downward drift and profits erode.Table 3.7 summarizes the characteristics, objectives, and strategies associated
with each stage.
Marketing Strategies: Introduction Stage
Because it takes time to roll out a new product and fill dealer pipelines, sales growth
tends to be slow at this stage. Buzzell identified several causes for the slow growth:
Figure 3-11 Sales and Profit Life Cycles