Product Life Cycle
Managing a product from conception through retirement is known as product life cycle management (PLM). American economist Theodore Levitt introduced the term in 1965, and it has become an essential tool for businesses of all sizes.
PLM helps businesses understand the various stages of a product's life cycle and the elements that influence each stage. This glossary of terms can assist you in making more informed decisions about product development, marketing, and pricing.
What is a product life cycle?
The product life cycle follows a product from conception to its eventual withdrawal from the market. It is a critical management tool used largely by marketing managers and brand leaders to analyse the behaviour of a product from its inception through its withdrawal.
PLM can help businesses to improve their performance at each stage of the product life cycle. For example, in the development stage, PLM can help businesses design products that meet the needs of their target market. In the introduction stage, PLM can help businesses to launch their products successfully and attract customers.
In the growth stage, PLM can help businesses to increase their market share and maintain their competitive advantage. In the maturity stage, PLM can help businesses to maximise their profits and extend the life of their products. In the decline stage, PLM can help businesses retire their products to minimise losses and protect their brand reputation.
The five stages of the product life cycle are:
Development stage
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Introduction stage
The stage in the PLC where the product is first launched and marketed to consumers.
Growth stage
The stage in the PLC where the product rapidly gains market share and sales.
Maturity stage
The stage in the PLC where the product has reached its peak market share and sales.
Decline stage
The stage in the PLC where the product's market share and sales are declining.
The other key components of a product life cycle are:
- Product life cycle (PLC): A product goes through various stages, from development to withdrawal from the market.
- Product life cycle management (PLM): PLM involves overseeing the entire life span of a product, starting from its initial creation to its eventual discontinuation.
- Market research: The process of collecting and analysing data about a market to understand its needs and preferences.
- Competitive analysis: The process of evaluating a company's competitors and their products or services.
- Pricing strategy: Setting prices for products or services to maximise profits.
- Product roadmap: A plan that outlines the development and launch of new products or features.
- Sales forecast: Predict future sales based on past data and market trends.
- Competitive advantage: Something that a company has that gives it an edge over its competitors.
- Strategies: Plans or actions taken to achieve a specific goal.
- Decision making: The process of choosing between two or more options.
- Product positioning: Creating a unique product identity in consumers' minds.
- Product pricing: The process of setting prices for products or services.
What are the benefits of a product life cycle?
The benefits of a product life cycle are:
Improved decision-making
The PLC can help businesses make better product development, marketing, and pricing decisions.
Increased sales
The PLC can help businesses increase sales by understanding the needs of consumers at each stage of the PLC and developing products and services that meet those needs.
Improved profitability
The PLC can help businesses improve their profitability by helping them to reduce costs and maximise sales.
Extended product life cycle
The PLC can help businesses extend the life cycle of their products by identifying and responding to changes in the market.
Gaining a competitive advantage
The PLC can help businesses gain a competitive advantage by understanding the needs of consumers at each stage of the PLC and developing products and services that meet those needs better than their competitors.
In a rapidly changing market, Infosys BPM's CPG outsourcing solutions, including Master Data Management and Advanced Analytics, are reinforced by their dedication to ESG principles. Their tailored approach has helped businesses reduce costs, improve performance, and increase sales at every stage of the product life cycle. By prioritizing environmental sustainability, social impact, and governance, Infosys BPM continues to lead with holistic and effective strategies for sustainable growth.
