Product Life Cycle

A company's positioning and differentiation strategy must change as the product, market and competitors change over the Product Life Cycle (PLC). To say that a product has a life cycle is to assert four things:

1. Products have limited life

2. Product sales pass through different stages, each posing a different challenge and opportunity.

3. Profits rise and fall at different stages of life cycle.

4. Products require different strategies in different life cycles.

The process wherein a product is introduced to a market, grows in popularity, and is then removed as demand drops gradually to zero.

There are four stages in the product life cycle: introduction, growth, maturity, and decline.

Introduction

After all research and development has be done it is time to launch the product and begin its lifecycle. The introduction stage of the product life cycle is when the marketing team emphasizes promotion and the product's initial distribution. Often the product will have little or no competitors at this point. Nonetheless, sales may remain low because it takes time for the market to accept the new product. At this stage of the life cycle, the company usually loses money on the product.

Growth

In the growth stage of the product life cycle, the market has accepted the product and sales begin to increase. The company may want to make improvements to the product to stay competitive. At this point, there are still relatively few competitors.

Maturity

In the maturity stage of the product life cycle, sales will reach their peak. Other competitors enter the market with alternative solutions, making competition in the market fierce. The company that introduced the new product may begin to find it difficult to compete in the market.

Decline

In the decline stage of the product life cycle, sales will begin to decline as the product reaches its saturation point. Most products are phased out of the market at this point due to the decrease in sales and because of competitive pressure. The market will see the product as old and no longer in demand.

There is no set schedule for the stages of a product life cycle. Differences will occur depending on the type of product, how well it is received by the market, the promotional mix of the company, and thof the competition.

 In 1947, Mitchell brothers of UK set up a manufacturing unit in Bangalore for Kissan and India’s first fruit and vegetable processing unit was set up. Therefore Kissan has the largest market share in jams with Rs 176 crore of the Rs 264-crore market. Therefore it is in the Maturity stage of the Life Cycle.