In recent years, it has become increasingly important to highlight the role of epidemiology within the framework of decision making regarding management and delivery of health services. As a healthcare….
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There are consumers who buy millions of products in the market every year. It is common and known to everybody that old and long-established products in the market will not attract consumers as much as they are attracted to new and innovative products. Like consumers, even products have a product life cycle. New products in the market have more demand when compared to old and long-established products. Many business companies are aware that every product has a specific lifespan. They always tend to invest more in developing new products and launching new products in the market.
In order to understand marketing strategies, it is very important for business owners to completely analyze and understand the product lifecycle.
Four stages of the product lifecycle:
Whenever a product is launched, it is very common that sales can grow or sales can remain static or sales can decline. Usually, it happens when a similar product is launched in different companies, and sales of a product depend on a customer satisfaction.
The product lifecycle has four stages, which mean different at different stages as the business tries to maintain and manage the lifecycle of each product.
1) Introduction: The first stage is the introduction stage. This is considered as the most expensive stage for every business as they invest money to launch a new product. Since the product is new and needs time to establish its importance in the market, the sales could be low in the beginning but may increase eventually. It is expensive because the cost for research and development, consumer or user testing, and marketing that is needed to launch the product.
There are various strategies to introduce or launch a product. There are two pricing strategies available. The strategies are completely dependent upon the nature of the product as well as the competition in the market.
a) Price Skimming: This involves introducing a product with the high price, and skimming the price as the market grows.
b) Price Penetration: This strategy involves introducing a product at a cheaper price and slowly increasing the cost as the market grows.
2) Growth: The growth stage involves growth in sales and profits. At this stage, the company begins to benefit from the economy as production and profit marginal. With the increase in profits, the company will be able to invest money in launching new products. With the result of this, the outlets also tend to increase.
3) Maturity: At this stage, the product is completely established in the market and now business owners will be very cautious to maintain their share in the market. This is probably the most crucial time for business owners where they should invest wisely in the products they are going to launch.
4) Decline: This is the last stage where the market for the product eventually declines. When this stage comes, it is business owner’s responsibility to get some profit by launching less-expensive products and cheap marketing strategies.
There are three strategies in this stage.
a) Milking: In this strategy, the product will have very less or no marketing support. The main aim to maintain the cash flow and gain some time to adjust to the declination.
b) Phased withdrawal: This strategy is used to replace products which are declining with the replacement products.
c) Contracting out: This strategy is used when the product has very less marketing support and sell the product a big known company so that they can get satisfactory returns for the market they have for the product.
Claessens, M. (2018, January 31). Characteristics of the Product Life Cycle Stages and Marketing Implications. Retrieved from https://marketing-insider.eu/characteristics-of-the-product-life-cycle-stages/
(n.d.). (2019, August 24). Product Life Cycle Stages. Retrieved from http://productlifecyclestages.com/
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To plan the life of product there are many tools but of those product life cycle is the useful tool, and it also has some limitations. We cannot say every products will follow smooth and expected way. Business cycles owns some products which will be completely tied to them and because of some factors it also effect the growth. Lets take an example, when you get admission from higher level of education with that you can easily track the financial ways. When ever there is an economic downfall, many people loose their jobs and they join in universities to get more knowledge on the courses according to their job prospective. When the financial crisis become stable again, then people will find jobs and there will be less college admissions. With this we can say when they are no necessity it mean the education will decline which is a down cycle.
In near by future, many people suggests that the there will be some work that will truly hold the industrial values but also have their necessity for independent brands or works, which will be more likely to be experienced at higher differential.
When there is change in some thing simultaneously its effect will be shown on other things which is called life cycle. When there is a change in this it will effect the competitive situation during the times and also it has the great impact on the market which will also has the PLC by itself. There will be an period which is called the result shown program or a dramatic by keeping it down and the price will also increase and the the pictures of the sales also will be deny time for temporarily at least.
Mullor-Sebastian, Alicia. “The Product Life Cycle Theory: Empirical Evidence.” Journal of International Business Studies 14.3 (1983): 95–105.
Grönroos, C. (2017). The perceived service quality concept–a mistake?. Managing Service Quality: An International Journal, 11(3), 150-152.