22-10-2012, 11:24 AM
PRODUCT LIFE CYCLE
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Introduction of Product life Cycle
Product life cycle is the study of strategies used as product goes through its life cycle. The condition in which a product is sold changes over time.
The product life cycle can be divided in four stages:
Introduction
Development
Introduction
Growth
Maturity
Decline
Illustration
For illustration of product life cycle , we select the product class of personal computing industry
We have take example of holographic projection , tablet pcs , laptops and typewriters .
Development stage
Begins when the company develops a new-product idea
Sales are zero
Investment costs are high
Profits are negative
Introduction stage
Low sales
High cost per customer acquired
Negative profits
Innovators are targeted
Little competition
Product class illustrating :Holographic Projection technology- Iphone5
Growth stage
Rapidly rising sales
Average cost per customer
Rising profits
Early adopters are targeted
Growing competition
Product class illustrating :Tablet PC
Conclusion
Product life cycle enables business management to define strategies and decision needed during each phase of product life. It help business management to manage marketing, financing, manufacturing, purchasing, and human resource strategies of the product.
However the duration of the product life cycle stage is unpredictable. It is not possible to predict when maturity or decline will begin. Strict adherence to product life cycle can lead a company to misleading objectives and strategy prescriptions.