The product life cycle refers to the stages of a product’s progression, from conception to regression. It is important for businesses to evaluate the stage of production and apply relevant marketing principles. It also allows companies to strategically discontinue a product and introduce an upgraded version or a new one. Marketing efforts can be targeted according to the particular stage of the product’s lifecycle.
The product life cycle is a trade term that refers to the stages in the progression of a product, from product conception to the point at which the product begins to show inevitable signs of regression. A similar example is the life cycles of a butterfly: the processes they go through, starting from fertilization to the formation of eggs, caterpillar, pupa and adult. Eventually, the butterfly will begin to show wear and tear until it dies. Knowing the various stages of the life cycle, the signs to look for and what to expect can be likened to the product life cycle in business. In this case, the subject is a product or service, and the importance of this process includes that it allows manufacturers and various enterprises to evaluate the stage of production, which allows them to apply relevant marketing principles.
One role of the product lifecycle in business is its utility as a measure of the state of a product in correlation with consumer and producer expectations. For example, it helps to consider the case of a product in the form of a smartphone that has been introduced to the market. The phone is received with much anticipation by consumers and hailed as the most innovative smartphone ever. As the months go by, other phone companies release their own similar versions of the smartphone, diminishing the dominance of that particular smartphone in the market. Aside from that, consumers are already craving a smartphone that will offer more than just that.
Smartphone makers know they need to monitor various indicators as the phone goes through its various stages to know when to discontinue the product and introduce another upgraded version of the phone or a new one all at once. This knowledge gives phone manufacturers a strategic advantage over other phone companies. It allows the company to get the most out of the product in terms of sales without losing its competitive edge over other companies, allowing the product to outlive its usefulness and possibly lose some customers to competitors with better products.
Another importance of the product lifecycle in the business world is the fact that it allows the company to target its marketing efforts according to the particular stage the product is at in its lifecycle. For example, the marketing campaign at product introduction will differ in the type of marketing impulse during the mid-lifecycle of the product in business. Knowing this is a crucial factor in formulating marketing strategies.
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