The Product Life Cycle theory was developed by the economist Raymond Vernon in and this theory is a widely used model in economics and marketing. According to Raymond Vernon, a product has a certain life cycle. It begins with its research and development stage and ends with its decline stage The underlying concept of life cycle costing is that a capital asset's "cost" should be taken to incorporate all of the costs associated with that asset over the course of its useful life (oodward, ). The costs, once gathered, could be evaluated against the costs of other projects Jul 07, · Depending on the product’s ability to attract and keep customers over time, a product life cycle may be a matter of months, years, or even decades. Anyway, there are four phases that every product undergoes in a market since it was produced and launched to its out-of market blogger.comted Reading Time: 7 mins
Life Cycle Essays: Examples, Topics, Titles, & Outlines
Just as operation managers must be prepared to develop new products, they must also be prepared to develop strategies for both new and existing products, product life cycle essay. First and foremost, before proceeding into the product life cycle strategies, lets define what a product life cycle is. According to Griffin and Eberta product life cycle is a series of stages through which it passes during its profit -producing life. Anyway, there are four phases that every product undergoes in a market since it was produced and launched to its out-of market position.
They are the introductory, growth, maturity and decline phases. Also, considerations must be given to how far product life cycle essay product is along the product life cycle. As it becomes more established, perhaps the after sales-service will play a product life cycle essay important role which leads to a more selective distribution, with only those dealers that are able to offer the necessary standard of after sales-service being allowed to sell the product.
In simpler words, in every phase of a product life cycle, a product should undergo different, suitable strategy in order to stay competitive in the ever changing market. Below follows the product life cycle stages along with their definitions and beneficial strategies…. According to Stevensonthe introduction stage begins when a product reaches the market place, product life cycle essay. When an item is first introduced, it may be treated with curiosity by the buyers.
Demand is generally low as buyers are not yet familiar with that item. Therefore, along with time, product life cycle essay, production and design improvements, many new products became more reliable, less costly, and also the increase in awareness in buyers lads to the increase in demand.
Also, according to Griffin and Ebertduring this stage, marketers focus on making their target markets aware of the products and their benefits. Also, during this stage, the particular product is represented with innovation diffusion of innovative curveproduct development Ansoff Growth Matrix and problem children Boston Consulting Group.
Among the common characteristics, according to Smith et al — are:. During this phase, as compared to the other phases, profits are negative or low because of low sales and high distribution and promotional expenses. Since the market is not ready for new products at this stage, the firm focuses on selling such items to those who are the readiest to buy. A company that wishes to be a market leader for its product must choose to launch a strategy that is consistent with product life cycle essay intended product positioning.
It is the second stage of product life cycle process. According to Heizer and Renderproduct life cycle essay, in the growth phase, product design has begun to stabilize, and effective forecasting of capacity requirements is necessary. Adding capacity or enhancing existing capacity to accommodate the increase in product demand may be necessary.
Also, customers who have tried the product earlier may remain loyal. Here, a company, in order to stay competitive in the market, should keep on promoting its product. In addition, profits start to increase. The firm has several strategies to stay in the rapid growing market as long as possible. Also, the firm improves the product quality, adds more distribution channels, changing the advertising theme — from promoting the product to the market to reminding the market on the availability of the product as well as to increase awareness.
The firm also lowers the price in order to attract more buyers. On the whole, as said by Smith et al —this phase is represented by:. The third stage for a product to go. As stated by Pride et al,sales are still increasing at the beginning of the maturity stage, but the rate of increase has slowed.
Later in this stage, the sales curve peaks and begins to decline. Many products maturity stages lasted longer than the previous stages. Industry profits decline throughout this stage. During this stage, sales growth starts to slow down.
Hence, the firm as well as its market product life cycle essay starts lowering down their prices, increases advertising and sales promotions. Also, the intense market led weaker competitors to quit. Only those strong enough will be able to precede the competition. A company should consider a different strategy when its product cines ti maturity, either by redesigning the market or its product. Modifying market is when the company tries to increase consumption if the current product.
The currently matured product can also be redesigned its package or style. Consumers may also be encouraged to use the product more often or in new ways. Pricing strategies are flexible during this stage, such as markdowns pr price incentives. Marketers may offer incentives and services to declare offering such matured products, especially from competitors. Sales promotions and aggressive personal selling can e effective during this period, product life cycle essay, when competition may require large promotional expenditures.
On the whole, just as adopted from Smith et althis phase is represented by:. The final stage of the product life cycle. According to Lancaster and Jobberit is when sales begin to fall and already slim profit margins are depressed even further. Customers have begun to become bored with the product and are looking forward to newer, latest products.
Dealers begin to de-stock the product in anticipation of reduced sales. Here, sales and profits sank lower, due to various reasons such as advancement in technology, shifts in consumer tastes or intense competitions.
Such factors have forced many companies to quit the market and for the other remaining companies, they may have to redesign their strategies to stay longer in the market by raising the price to cover cists, re product life cycle essay to maintain market share, or lower the price to reduce inventory. In other words, distribution of the declining product will be narrowed to te most profitable existing market.
Also, the product will not be highly promoted, although advertising and promotions may be used to slow down the decline. Instead, the firm may even decide to drop the product entirely at the end.
Just like the above three phases, this stage is also represented by:, product life cycle essay. Below are some factors that supply as market indicators that serve as an aid for a firm in detecting its product maturity and decline…. Buyers have become product life cycle essay with the related product and hence, they are unwilling to pay finest price for the product in order to obtain brand security.
A suitable example for this case is the black and white television sets which due to technological development have lead to the production of color televisions — a definite unpredictable effect on sales of black and white television sets. Actually a product life cycle is conceptually simple yet powerful. However, it is not easily applied. The stages described above are not easily forecasted or predicted or even easily determined. Furthermore, it is difficult to determine and analyze the product definition and finally, product life cycle essay, even if the stages in the life cycle are determined, the strategy implications are not always obvious.
Therefore, product life cycle essay, on the whole, I would like to conclude that a company should be aware of the life cycle stages of each product it is responsible for. The company should also predict on how long the product is expected to linger in that stage.
Such thinking is very important for setting up strategies such as let say, if the product is expected to remain the maturity stage for a long time; a replacement product might be introduced later in the maturity stage.
On the other hand, if the maturity stage is expected to be short, however, a new product should be introduced much earlier. Product life cycle and its stages, product life cycle essay. Accessed May 19, Product life cycle and its stages Categories: Business Product Life Cycle. Download paper. Essay, Pages 8 words. Get a verified writer to help you with Product life cycle and its stages. Top Writers, product life cycle essay.
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The Product Life Cycle
, time: 14:41Product life cycle and its stages Free Essay Example
The Product Life Cycle theory was developed by the economist Raymond Vernon in and this theory is a widely used model in economics and marketing. According to Raymond Vernon, a product has a certain life cycle. It begins with its research and development stage and ends with its decline stage The underlying concept of life cycle costing is that a capital asset's "cost" should be taken to incorporate all of the costs associated with that asset over the course of its useful life (oodward, ). The costs, once gathered, could be evaluated against the costs of other projects Jul 07, · Depending on the product’s ability to attract and keep customers over time, a product life cycle may be a matter of months, years, or even decades. Anyway, there are four phases that every product undergoes in a market since it was produced and launched to its out-of market blogger.comted Reading Time: 7 mins
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