Significance of Product Life Cycle

Signifi hoboce of crossway Life CycleThe sentiment of return life-cycle highlights that earlier or later all harvest-feasts die and that if centering wishes to sustain its revenues, it moldinessiness re bureau the declining harvest-tides with the newly ones. The point of intersection life-cycle concept indicates as to what can be expected in the market for a new crossing at various stages. i.e., introduction, result, due date and decline. Thus, the concept of harvest-home life-cycle can be apply as a forecasting tool. It can alert management that its product will inevitably face saturation and decline, and the host of problems these stages pose. The product life-cycle is all overly a useful framework for describing the typical evolution of marketing outline over the stages of product life-cycle. This will help in taking sizable marketing decisions at different stages of the product life-cycle.After a product has been developed, it is launched in the market with the help of various promotional devices such as advertising, gross gross sales promotion, publicity and p arsonal selling. In other words, product development must be followed by the successful introduction of the product in the market. For this, preparation for introduction of the product starts during the process of product development itself. Every flying get hold ofs sale projections during introduction, growth and maturity stage of the product life-cycle. To acheive the projected sales target, it formulates promotional, pricing and distribution policies. Thus, the concept of product life-cycle facilitates integrated marketing policies relating to product, price, place and promotion/distribution.The advantages of PLC to a faithful are as followsWhen the product life-cycle is predictable, the management must be cautious in taking advance go before the decline stage, by adopting product modification, pricing strategies, style, quality, change, and so onThe firm can prepare an effective product plan by cognize the product life-cycle of a product.The management can find new uses of the product for the expansion of market during growth stage and for extending the maturity stage.The management can adopt latest technological changes to improve the product quality, features and design.STAGES IN return LIFE-CYCLEProduct life cycle comprises four stagesIntroduction stage return stageMaturity stageDecline stageproduct-life-cycle-stages-plcFig 1 product life-cycleProduct Life Cycle (PLC)Introduction stageEXAMPLES FROM diverse SECTORShttp//www.ithappensinindia.com/wp-content/uploads/2010/09/BPL-Television.jpg BPL TELEVISIONSMany products generally oblige a characteristic known as perishable distinguishableiveness. This means that a product which is distinct when new de move overs over the years into a common commodity. The process by which the distinctiveness gradually disappears as the product merges with other competitive products, has been rightly termed by Joel dean as the cycle of competitive degeneration. The cycle begins with the invention of a new product and is often followed by patent protection, and further development to make it saleable. This is usually followed by a rapid expansion in its sales as the product gains market acceptance. Then competitors enter the field with fictitious and rival products and the distinctiveness of the new product starts change magnitude. The speed of degeneration differs from product to product. While some products fail immediately on birth or a little later, others whitethorn live long enough. BPLs picture in picture TV was eliminated at the introduction stage itself. The innovation of a new product and its degeneration into a common product is termed as the life cycle of a product. in that location are five distinct stages in the life cycle of a product as shown at a lower place Introduction. Research or engineering skill leads to product development. The product is throw away on the market awareness and acceptance are minimal. at that place are high promotional be. Sometimes a product may generate a new devour on, for example, Maggi. Volume of sales is low and there may be heavy losses.Growth. The product begins to make rapid sales gains because of the additive effects of introductory promotion, distribution, and word-of-mouth influence. High and sharply rising network may be witnessed. But to sustain growth, consumer satisfaction must be ensured at this stage.Maturity. Sales growth continues, but at a come downing rate, because of the declining number of potential customers who remain unaware of the product or who have taken no action. Also, the last of the unsuccessful competing brands will probably pull in ones horns from the market. For this reason, sales are likely to continue to rise while the customers for the recede brands are mopped up by the survivors. There is no improvement in the product but changes in selling effort are common. good mar gins slip despite rising sales.Saturation. Sales yield and remain on a plateau marked by the level of replacement demand. There is little additional demand to be stimulated.Decline.Sales begin to diminish absolutely as the customers begin to tire of the product and the product is gradually edged out by better products or substitutes, for example, dial telephones and gasolene jeeps.http//www.mbaknol.com/wp-content/uploads/2010/06/product-life-cycle.jpgTimeFig 2 product life-cycle of BPL TVsThere are some(prenominal) reasons why the life-cycle of a product tends to be short (a) continuous look for for product development, (b) simultaneous attempts by several companies in the same direction, and (c) lean of a new idea to attract competitors. Improvements offered by one come with are likely to be met and, if possible, exceeded by competitors in a comparatively short period. If a competitor hits upon a real improvement (perhaps ground on an entirely new technology) and he markets it well, both sales and cabbage of the original technology) and he markets it well, both sales and profits of the original product innovator may decline drastically.It may be noned that products may begin a new cycle or revert to an betimes stage as a result of (a) the discovery of new uses, (b) the sort of new users, and (c) introduction of new features.As the distinctiveness of the products fade, the pricing discernment enjoyed by their producers gradually declines. This is what happened in the case of many products like ball-point pens, transistors, radios, etc. Throughout the cycle, changes take place in price and promotional elasticity of demand as also in the production and distribution costs of the product. Pricing policy, therefore, must be adjusted over the various phases of the cycle.Product life-cycle concentrates only the life-cycle of a product beginning with its introduction into the market to the post-marketing phase. However, a series of processes are to be und ertaken by the management even forward to the introduction of a product in the market. These processes include exploration, screening, analysis, development, testing, etc. The concept of product life-cycle may be used as a managerial tool.Marketing strategies, however, have to be changed with changes in the phase of the life-cycle of a product. An soul of the cycle is helpful to the managers for a rational understanding of the future sales activities as also planning of marketing strategies. Hence, PLC is synonymous with the pattern of demand for a product over time.The length of time that a product spends at anyone stage varies from product to product. A product qualification non pass with every stage in the cycle. Some products, for instance, susceptibility not get past the introductory stage, while others might not get past the growth or even the maturity stage. There might be still other products that might pass through the introduction to maturity stages but might take a eight-day period to reach the saturation stage and hence might take a hourlong period to reach the decline stage. Some products, for instance, might not get past the maturity stage. There might be still other products that might pass through the introduction to maturity stages but might take a longer period to reach the saturation stage and hence might take a longer period to reach the decline stage. Some products might even ado through the entire cycle in an amazingly short period. In certain cases, there might even be a displace of a product, which might trigger off a new growth cycle.http//www.dineshbakshi.com/phocadownload/product-life-cycle.jpgFig 3 product life-cycle of Facebook