|
|
Product Life Cycle
|
12manage reaches 100.000 members |
Analyzing Industry maturity stages. Explanation of Product Life Cycle of Levitt, Fox, Wasson, Hofer, Anderson & Zeithaml, Hill & Jones. ('65) |
|
|
The Product Life Cycle model can help to analyze maturity stages of products and industries.
The term was used for the first time by Theodore Levitt in 1965 in an Harvard
Business Review article: "Exploit the Product Life Cycle" (Vol 43, November-December
1965, pp 81-94). Any company is constantly seeking ways to grow future cash
flows by maximizing revenue from the sale of products and services. Cash Flow
allows a company to maintain its viability, invest in new product development
and improve its workforce. All this in an effort to acquire additional market
share and become a leader in its respective industry.
Also, the modern Product Life Cycle is becoming shorter and shorter. Many
products in mature industries are revitalized by product differentiation and
market segmentation. Organizations increasingly reassess product life cycle
costs and revenues, because the time available to sell a product and recover
the investment shrinks.
The stages in the Product Life Cycle
Several variations of the Industry Life Cycle model have been developed
to handle the development of the product, market, and/ or industry. Although
the models are similar, they differ as to the number and names of the stages.
Here is a list of some major models: variations of the life cycle model1973: Fox: precommercialization - introduction - growth - maturity - decline. 1984: Anderson & Zeithaml: introduction - growth - maturity - decline 1998: Hill and Jones: embryonic - growth - shakeout - maturity - decline
Product Life Cycle Special Interest Group
Product Life Cycle Forum
Product Life Cycle Education & Events
Compare with Product Life Cycle: Bass Diffusion Model | Stage-Gate | ADL Matrix | BCG Matrix | Relative Value of Growth | Positioning | GE Matrix | Innovation Adoption Curve | STRATPORT | Profit Pools | Marketing Mix | Four Trajectories of Industry Change | Co-Creation | Disruptive Innovation
Return to Management Hub: Change & Organization | Decision-making & Valuation | Finance & Investing | Marketing | Strategy | Supply Chain & Quality
|
12manage for: |
|
|
|
|
| ● (china) | Stage after Breakeven | "in our project, we call it end of line( EOL)" |
| ● Eunse (S Korea) | Preventing from Reaching the Decline Stage | "According to Christensen's Disruptive Innovation strategy, there's no way of just staying on the top of the game for good. Personally I agree with his view and would say it's best to come up with a better product before the current product hits the decline stage and takes the whole company down with itself." |
| ● Philippe (France) | Variations on clean wave patterns | "Other reasons for disturbances of the wave form are also possible. Think of seasonal effects. Also the company itself can influence the pattern. For example by investing a lot in promotions in the maturity stage. Or by introducing product innovations." | |
| ● Bertus (Belgium) | Life Cycle form | "Also changes in the taste of customers and even such unpredictable external variables as the Euro or Dollar rate may influence the wave-form of the cycle." | |
| ● Dr.P.L.Narasimhan (India) | Product Life Cycle not Symmetrical | "Please permit me to add few comments on this informative article on the product life cycle. Generally the curve is not symmetrical and short in X-axis after maturity. There is every likelihood that the curve may also stoop steeply after maturity because of the competitive pressure and change in technology. The mature stage may also be flat. The company should be ready with the next product ready to be released, based on the timing, and revenue realization in relation to the investment. Possibly the company can think of extending the life of the product by flattening the mature stage and lessening the drop in the decline stage by value addition to the product." | |
| ● Dr. Uditha Liyanage (Sri Lanka) | Distinguish between Product LC and Brand LC | "A distinction must be made between the Product Life Cycle and the Brand Life Cycle. The PLC may follow a different trajectory from that of the BLC." | |
| ● Sandeep Dogra (India) | No Revitalising in the Maturity Stage | "The Maturity stage is a honeymoon period for any product with a life span of minimum 7 years. It is accompanied by low advertising intensity, homogenous and large packaging, defined target market and above all a stable loyal cutomer base. So watever be the revitalising strategies (Market Penetration or Product Development), they must be applied in the Decline stage." |
|
| ● Mats (Sweden) | Product life cycle profit vs volume | "Another disturbing factor is that the actual product volume varies over time and the input and effort of the production system vary. Thus, it would be interesting to build on the curve and include profit margin." | |
| ● Wilians Rizzo (Brazil) | The decline is the beginning of a new cycle. | "The decline phase starts when a new product appears with more advantages." | |
| ● Dr Adrian Boucher (UK) | Product Lifecycle Model | "Although the general characteristics of the PLC model make use of the concepts of Introduction-Adoption-Maturity-Decline, there can be variations on this main theme. The overall profile of the PLC curve over time is most unlikely to be symmetric, because opportunities exist for prolonging the PLC through enhanced marketing activities (and budget), or of thinking of new uses for products. One classic example (possibly apocryphal) concerns the fate of baking powder (soda). As home baking declined from the 1950s-60s, sales of the product plummetted until an accidental placing of some baking powder in a refrigerator overnight killed unpleasant odours, rendering a brand-new life for baking soda as refrigerator deodorant and subsequent high profits." | |
| ● (Japan) | Crossing the Chasm, Product Manager | "In case of high-tech industry, we consider the diffusion of innovation(ref. 'Crossing the Chasm' Geoffrey A. Moore). Based on this, there's a gap to clean up skepticism for new technologies. And it'll take 6-month to 2-year period until the diffusion of innovation accepted into majority group.
Company will take marketing action to cross the chasm existing between innovator and early majority. But sometimes, a product won't be able to cross the chasm due to investment issues, people issues, and market timing issues. Then most of them will not keep up with the PLC model, drastically change their business situation and their operation may get to the end or be targeted at M&A before success. However, companies understand such a trend and then apply marketing activity to stabilize sales as well. Then in the long run, the product's life cycle doesn't misfit the general model. A product manager should control these scenarios." |