Market research is an essential part of any marketing campaign. A popular research method to use is the Product Life Cycle. It consists of 4 stages- introduction, growth, maturity, and decline.
Understanding the Product Life Cycle
The introductory stage of a product is usually a new product. Since the product is new, it often has slow initial growth. This is because the marketplace needs time to learn and use it. Time and patience during this stage is all you can really do. Let the market decide whether to reward it or neglect it. It is important not to stress about it taking so long, it is normal.
The Growth Stage
Growth follows the product’s introduction and often means that the market has interest in the product and sales are beginning to increase significantly. It is in this stage where it is smart to introduce a line extension. This will help grow the market and increase market share. The growth stage is where you will see most of your sales.
The Maturity Stage
This is the third stage of the Product Life Cycle and is often the longest stage. The increased sales you get during the growth stage are not infinite and are bound to plateau. The maturity stage is where your sales figure reaches their ceiling and profit margins begin to narrow. This by no means translates to dumping the product. In this stage price reduction or discount can keep the momentum going. Also now is an ideal time to begin considering new products to launch in the near to distant future.
The Decline Stage
The final stage in the cycle, the decline stage is usually the most unpleasant. This is when you witness sales decreasing and customers moving on to other products. Some people choose to run the product to the ground, picking up as many sales until it becomes unprofitable. Others use this opportune time to introduce their new products they began drafting in the maturity stage. Then the cycle starts all over again with the introduction of a new product.
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