Product Life Cycle

PRODUCT LIFE CYCLE GRAPHS INTRODUCTION DEVELOPMENT GROWTH MATURITY DECLINE Obsolescence 4 STAGES 6 STAGES

PRODUCT LIFE CYCLE What is the product life cycle? Development: A product life cycle is a graph that shows a new product from its introduction into the market through to its end of life (recycled or reused) . There are 6 main stages of product life cycle :   Development: Product is designed, developed and tested before before being batch or mass produced. Introduction: cost high sales volume low no/little competition - competitive manufacturers watch for acceptance/segment growth losses demand has to be created customers have to be prompted to try the product

PRODUCT LIFE CYCLE Growth costs reduced due to economies of scale and sales volume increases significantly profitability public awareness competition begins to increase with a few new players in establishing market   Maturity Costs are very low as you are well established in market & no need for publicity. sales volume peaks increase in competitive offerings prices tend to drop due to the proliferation of competing products brand differentiation, feature diversification, as each player seeks to differentiate from competition with "how much product" is offered  

PRODUCT LIFE CYCLE Decline Obsolescence costs become counter-optimal sales volume decline or stabilize prices, profitability diminish profit becomes more a challenge of production/distribution efficiency than increased sales Obsolescence Stop production and sale of product.

PRODUCT LIFE CYCLE A chart showing six stages in the life cycle of a product is given below Complete the table below to show the name of each numbered stage shown on the product life cycle chart. The first one has been done for you. INTRODUCTION GROWTH MATURITY DECLINE OBSOLESCENCE

PRODUCT LIFE CYCLE State two possible reasons for the increase in sales shown at letter A on the chart. Decrease in cost of the product Increased advertising Release of a new design features such, as new colour, logos, styling, reduced size and weight

PRODUCT LIFE CYCLE Look at Fig.1. Each of the numbers indicates a particular phase of the Product Cycle. These five phases are identified in Table 1 below, but they are not in the correct order.   1 2 3 4 5 Peak/maturity Rise Decline Obsolescence Introduction  

PRODUCT LIFE CYCLE Peak/maturity Rise Decline Obsolescence Introduction Look at Fig.1. Each of the numbers indicates a particular phase of the Product Cycle. These five phases are identified in Table 1 below, but they are not in the correct order.  Name of phase Explanation of each phase (with reference to your chosen product)   1 Introduce the outdoor seat to the market (advertising, price Introduction 1 2 3 4 5 2 Develop a brand loyalty. More people buy the outdoor seat Rise 3 Decrease price of outdoor seat, release new versions with different colours and patterns. Maturity 4 Reduce price further as more competitors flood the market, reduce production Decline 5 Stop production of original outdoor seat and develop a new range. Obsolescence

PRODUCT LIFE CYCLE State one advantage of following a product cycle graph for: (i) the designer  (ii) the manufacturer Designer The designer would know when to release new features to boost sales, when to release a brand new product and exactly know when competitors will enter the market Manufacture Will know when to increase and decrease production (number of products, man power, materials and bought in components) by following the PLC graph.

PRODUCT LIFE CYCLE It is said that we live in a throwaway culture. Discuss the ways in which built-in products obsolescence contributes to a throwaway culture.