Product life-cycle strategies

It is not a surprise that we talk about the product life cycle. It describes the story of a product, from the development to the decline. For some product, the lifecycle can be determined in advance. For a company to launch a new product, the company must first be sure that the product is going to sell in order to hope for a good margin. We can find 5 different steps.

The first step is product development. It starts when a new company arrives and develops a new product idea. Sales are null and costs are already beginning to appear.
The second step is the introduction. It represents a period of slow sales growth. The product is introduced to the market. You may encounter heavy expenses at this stage, and no income.
The third is a period of growth, with a rapid market acceptance and increasing profits.
After this growth, generally, the product reaches its maturity. There is a slowdown in sales growth. The product has been accepted by most buyers. Depending on the competition profits, level may increase or decrease.
Finally, at the end of the product lifecycle, the decline sets the decrease of sales and profits.
Another way to describe a product life cycle is to define the type of trend that the product is defining. A new product can be following a style, a fashion, or can describe fads. A style is a long life cycle, it has different period of renewed interest. As a result the style doesn’t die. It can be applied to important products, day to day product, for example the architecture, furniture, or clothing.
A Fashion grows slowly, remains on top for a while, and decreases slowly. A fashion will be accepted during a set period of time, then will be disappearing little by little.
Fads are specials. They describe very short life cycles, with very high sales. This is driven by an unusual customer enthusiasm for the product, which doesn’t last long. Products in fads are products that attract the attention, but are not sufficiently solid to live longer.