Stages of the product life cycle/definition/importance of managing
If you want to analyze the evolution of your sales, you must know the life cycle of a product. As we know, a product is conceived, then it is born when it enters the market, it ages and finally dies and, therefore, it disappears from the market. Stages of the product life cycle
Like living things, some products have a longer life, a stronger market presence, than others.
Let’s learn more about this term and how it affects your business.
What is the life cycle of a product?
The life cycle of a product is a term used to describe the stages of creation, growth and purchase that any product goes through on its way to and through users. The traditional stages of a product’s life cycle are development, introduction, growth, maturity, and decline.
The life cycle of a product plays an important role in the sales and therefore the profits of a company. That is why it is important to address it before launch. But not only do you have to worry about management and control, the product life cycle also affects marketing. Stages of the product life cycle
Why know the life cycle of a product?
Knowing what phase a product is in allows a more efficient allocation of resources. Therefore, the life cycle of a product must also influence the choice of marketing tools used in each phase of the cycle.
Marketers use the product life cycle to create marketing strategies that reach a wide audience of consumers, to brand and to price the product .
Product managers use the product life cycle to assess development resources, investment, and maintenance for a product or feature.
Stages of the product life cycle
These are the stages to correctly determine the life cycle of your product:
The cycle begins with an idea that becomes a concept. Ideation is the process that includes evaluating new product objectives, investigation of market suitability, market demand, competitor analysis , investigation of utility, potential revenue opportunity, and potential costs. .
Many parts of the organization are often involved in this phase, such as marketing, product, engineering, design, and management of the organization.
Development begins once market demand has been assessed and ideation has resulted in a formalized plan for a new product. The stage includes the final designs, written requirements, and acceptance criteria.
Engineers, product managers, customer experience designers, and quality assurance analysts are often the main contributors in this phase. Marketers are in the strategy phase when the product enters the development phase and they begin planning market positioning and pricing for the introduction phase.
Introduction begins after development is complete, as soon as a viable product is available for use. In this phase, the market will know the product for the first time. Stages of the product life cycle
Many times, marketers take the initiative to bring the new product to market based on the strategy they created during the development phase. The introduction strategy includes the target market segment, the channels and forms of advertising that will be used to introduce the new product, and the messages that will be used when marketing it to consumers.
Growth is the stage when customers adopt the new product. The adoption of the product continues to increase and the benefits as well. Sales teams may even be incentivized to sell the new product to existing and potential customers.
Development teams often continue to make changes and improvements to the product during the growth stage. Teams are monitoring the product to achieve the goals that were set during ideation. The product continues to receive investment in the form of marketing and development efforts.
Maturity is reached when the adoption of the product no longer grows at an exponential rate and has reached its saturation in the market. Teams may decide to continue investing in the product to remain competitive, or they may leave it unattended while they focus on other product efforts in earlier stages.
Many times in the maturity stage the product receives at least minimal development for maintenance, but marketing efforts have become minimal.
The decline occurs when the market no longer needs the product in the same way that it did during the early stages of the product life cycle. Customers abandon the product and sales are likely to decline.
Many teams decide to stop supporting the product during the relegation phase and either abandon it or decide to withdraw it from the market entirely. This occurs when customer usage drops to a low percentage of the overall customer base.
Some teams may reinvent the product at this stage by adding new features, finding new market segments for the product, or repackaging the product to allow for new marketing efforts.
Whether the product is abandoned or reinvented, letting a product reach the state of decline allows the team to refocus on the product life cycle.
The importance of managing the life cycle of a product
Understanding the product life cycle is critical to both product and marketing teams and the organization as a whole. Stages help teams understand what level of investment a product should receive, which products in the company’s portfolio should receive the most attention and investment, and which products have the most opportunities for growth, revenue, and profit.
Lifecycle management affects many teams in the organization, especially those in sales, marketing, and product development. The Product Lifecycle Framework helps teams make tough decisions about existing products, while helping new ideas grow.