The product life cycle consists of the following four stages; however, remem-

ber that not all products go through each stage:

1. Introduction: During this stage of the product life cycle, a business

seeks to build product awareness and develop a market for the product

by using promotion. The need for immediate profit isn’t of concern in

this stage.

2. Growth: The focus in this stage is on building a brand preference and

increasing and stabilizing the market share. Competitors are attracted to

the market, and they begin to offer similar products. At this point, prod-

ucts become more profitable because of the growth in sales and because

companies form alliances and strategic partnerships to take each other

over. Advertising and marketing spending is high during this stage.

3. Maturity: The growth in sales begins to diminish during this stage. A

product that survived the first stages tends to spend the longest time

in this stage. Sales are still growing, but at a much slower rate. Because

more competition begins to appear in this stage, it’s extremely impor-

tant to differentiate your product. You may begin to notice that the

market is saturated and that price wars and intense competition begin

to occur. It’s common to begin to see businesses leave the market due to

poor margins.

4. Decline: In this stage, you often see a decline in the market of the prod-

uct. This decline is often caused by the introduction of more innovative

products. It also can be due to the changing tastes of consumers. You

often see intense price cutting in this stage, and even more products are

withdrawn from the market.

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