It is a concept that describes the stages via which a product or service passes on the market from its introduction to the completion of sales. This stages are typical for any industry: entertainment, food, clothing and accessories, technology, software, custom ecommerce development services.
The life cycle consists of six stages. Let’s take a closer look at them.
New product development
At this stage, the company works on the concept, design and testing of a new product. It all starts with an idea that arises from market needs, technological innovation or strategic business goals.
The company studies the market, conducts niche analysis, determines the target audience and competitors. The main goal of this process is to evaluate the potential and viability of the product.
The next page is a product creation and testing to identify its strengths and weaknesses. Based on the data obtained, adjustments are made and the product is released to the market.
Start of sales
At this stage, the company begins promoting the product on the market. The following marketing tools are used for this:
- advertising in the media;
- digital marketing;
- PR events;
- content creation;
- participation in exhibitions and events.
The goal is to attract the attention of the target audience. A positive brand image is created so that consumers are willing to buy it.
Analyzing the needs and behavior of potential buyers is a component of successful implementation. It is also important to monitor the activity of competitors and changes in the market to respond quickly.
Sales growth
This period is characterized by rapid growth in sales volumes, increased market share and increased consumer interest. At this stage what happens:
- Attracting new customers and retaining existing ones means a developing effective marketing strategies and loyalty programs that expand a new product customer base.
- Formation of brand loyalty.
- Improvement of the product, taking into account customer feedback.
- Communication with consumers.
The company aims to use sales growth to strengthen its position in the market. Business process optimization, product innovation and effective customer communication play a key role.
Maturity
The peak of a product’s life cycle is characterized by consistently high demand, stable sales volumes and an established circle of loyal customers. Despite the strong performance, it is important to continue to improve the product and actively respond to consumer requests.
At the stage of product maturity, the company can enter the international market. This stage will open up new perspectives. In case of stable demand and a loyal customer base, the company may consider increasing the prices of their goods.
Recession
The audience’s interest in the product begins to gradually fade. It may occur due to the emergence of competitors or new products, changes in consumer preferences, or improvements in technologies that better meet current market needs. Recession is an inevitable stage in the life cycle of a product. But the company can take certain steps to slow it down and increase the life of the product.
Market exit
The market exit stage is the final phase of a product’s life cycle, when a company faces an irreversible decline in demand for its product and incurs significant losses. If it decides to keep the brand and focus on other areas, it may decide to withdraw the product from the market. In the worst case scenario, the only solution is to close the business.
