Product Life-cycle Theory

The Product Life Cycle is the course that a product’s sales and profits take over its lifetime.’- Principles of Marketing by Philip Kotler. The product life cycle is a marketing theory in which products or brands follow a sequence of stages including introduction, growth, maturity, and sales decline.

Product Development this is the design of a product this changes each year even products already developed are evolving all the time for example the ipod. When the first ipod came out it was big and had a bright green screen it then went to the ipod nano which was a smaller ipod.

Then ipods had colour screens and you could put pictures on it and films. They have recently come up with a new model ipod touch and also the iphone both of these are touch screens. When any new product comes out it has zero sales as it is new businesses use the four P’s to make sure they maximise sales.

The Product Life Cycle

Introduction Stage

Focused and intense marketing effort

This is the design stage where they think of a product which they feel there is a gap in the market for there product and whether or not they feel they can succeed and be profitable for example playstation they have 3 consoles xbox realised a new console in 2006 the xbox360 playstation came up with a new console the playstation 3 it had more extra’s than the xbox and had free internet access on it and more extra’s.

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Establish a Clear Identity

It is important for a business to develop an identity for they this is important so customers can relate to the business and it can be separate image for that of its customers. For example addidas have a motto impossible is nothing it’s catchy and inspirering. Also they use celebrities to endorse there product when people think about David Beckham than they think addidas the two are thought off together.

Promotes Maximum Awareness

For a product to promote maximum awareness than they must use the marketing mix effectively to do this the company needs to utilise the 4 P’s if this is done than enough people should know about the product for it to succeed. Carlsberg is a prime example of this they are frequently advertised on television with a variety of supermarkets and also an advertisement by the company itself with also have catchy motto’s Carlsberg properly the best larger in the world.

Trial or Impulse purchases occur at this stage

When a new product comes out it has zero sales no one has seen this product before so it generates interest and people will buy for the sake of buying this product this is buying on impulse. An example of this would be when ipods first came out no one really new what it was and it generated a huge interest people bought on impulse.

Growth Stage

Increasing Sales Experienced

When a product is first introduced the sales will increase rapidly because it starts at zero sales. Customers see a new product it increases interest and people start to buy. An example of increasing sales experience is blue ray DVD players it is new technology it is a relatively new product and sales haven’t peaked yet.

Competitors Emerge

Competitors emerge once a product has been released and has become successful other companies see this and release there own products. An example of this would be games consoles in general when a new generation of games consoles come out they all come out within a year and half of each other and have almost identical features.

Sustained Market Activities

Sustained market activity is important for a product to be successful the marketing mix most be used efficiently. All large companies do this good market research is key for this Sony have sustained market activities because of there ability to adapt to the current market.

Maturity Stage

In this stage sales have peaked they are still quite high but are not increasing.

Competitors begin to leave the market this is because the sales have stopped growing so there are now no new customers. This may happen in television market as five or 6 years ago ordinary widescreen televisions had become quite popular and many homes had got one but they soon stopped increasing with new flat screen televisions about to enter the market so competitors left the market.

Sales Velocity is dramatically reduced the products growth stops it still makes a profit but profits do not noticeable increase.

Sales Volume reaches a steady state this will show up like a flat line on a product life cycle graph it is where the products are now not attracting any new customers.

Mostly Loyal Customers buy the product this is where profits and product interest has stopped it only gets repeat purchase from loyal customers there are no more impulse buying of the product.

Decline Stage

Lingering Effects of competition this may add to the decline of a certain product if rival companies release a similar product an example of this would be Nintendo GameCube came out a year before play station 2 it had huge success until the realise of play stations new console then declined.

Unfavourable economic trends this contributes massively to some items profits. We are now in a credit crunch and all car companies are at a loss and almost all have stopped production.

New Fashion Trends is where a product is no longer in demand an example of this would be tamagochi toys they where a must have accessory in the late 90’s to young children to teenagers but the trend soon changed and they now cannot be found

Boston Matrix

The BCG matrix (aka B.C.G. analysis, BCG-matrix, Boston Box, Boston Matrix, Boston Consulting Group analysis) is a chart that had been created by Bruce Henderson for the Boston Consulting Group in 1970 to help corporations with analyzing their business units or product lines. This helps the company allocate resources and is used as an analytical tool in brand marketing, product management, strategic management, and portfolio analysis.


A dog this is business term for company which has a low share of a low growth market. They do not generate cash for the companies they are tend to suck money into the company. These are the sort of products you should not invest in. An example of this would be a tamagochi it was a electronic toy which only ever lasted a few months it soon came out of production and now can not be found.

Cash Cows

These are products with a large share of a slow market growth. They generate money for the money that is invested into the company. This is a company which you would keep your shares in. An example of this would be in the car manufacturer the bmw m3 it is a high powered large sports car and not many would buy them.

Question Marks

These have low share in high growth market. The money invested in them is used up mostly on marketing to try increase awareness and profits. An example of this would be fruit of the loom clothing is constantly growing and also in a fashion orientated generation but people want designer clothes.


These are products which has a high share in a high growth market these make a lot of money for the money invested it’ll be promoted heavily and expand the product when needs be. An example of a star would be the apple ipod more and more people are buying them and they already have a high market share in a high market growth. Magners Cider would be a Star it has a large share in a high growth market a lot of people buy alcohol and a lot of people buy Magners it is a popular brand.

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Product Life-cycle Theory. (2017, Jul 16). Retrieved from

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