A product, just like a human being has a life span, it does not live forever. At a point it is expected to die off. A product has an introduction stage, growth stage, maturity stage, saturation stage and the decline stage; this is known as the stages of a product life cycle, hence a product necessarily goes through a life cycle.
The various stages of the product life cycle has characteristics which distinguishes them from each other. These characteristics are as follows:
The introduction stage being the first of the product life cycle introduces the product into the market. At this stage, there should be more of advertising in which the advertisement should highlight the benefits and features of the product/service. An example is when Biotone cream emerged the ad message was how good the product is and how it gives a beautiful skin tone hence their slogan “ Biotone, a beautiful tone” Here, advertisement should aim at gaining respect and a good reputation to attract customers. . The types of consumers here are called the innovators.
Costs of production are very high at the introduction stage but low sales are being recorded. Demands for the product are also being created and customers are prompted to try the product by giving them samples to go and try. Another important characteristic of the introduction stage is that profit or money is not made.
The growth stage is the second stage of the product life cycle, advertising is of prime importance since depending on your efforts, and the product can gain a certain market share or mindset. This stage is known as the teething stage; sales can increase impressively but diminish at a point in time. Promotional messages must therefore impress audience to avoid dipping.eg Expresso is experiencing a dip after taking over from kasapa.
Some characteristics of the growth stage are: cost reduced due to economies of scale, economies of scale is the increase in efficiency of production as the number of goods being produced increases. Sales volume increases significantly and hence profits begins to rise. There is also increased competition which leads to price decrease; public awareness increasing is another important characteristic of the growth stage. The types of consumers you find here are called the early adopters.
The maturity stage is the third stage of the product life cycle, at this stage the product has been in existence for a while so consumers or customers know the attributes, qualities, benefits and features of it. Strategies like price reduction, distribution of incentives to distributors, wholesalers, retailers and vendors (e.g. is the fridges distributed wholesalers and retailers by Coca Cola), promotions and adding additional benefits to the existing products e.g. Omo -3-in-1
Some of the characteristics of the maturity stage also include: costs lowered as a result of production volume increasing and experience curve effects, it is the most profitable stage. The competing products may be very similar at this point increasing the difficulty of differentiating the products.
The saturation stage is the stage where there may be few or no customers left .the appropriate strategies used at this stage are sales promotion like” buy-one-get-one-free”, gift vouchers, raffle draws and the ongoing Guinness football challenge program by Guinness Ghana; product or service innovation like “Gino rice”,” Gino oil”,” Gino tomato paste” and “Gino spaghetti”, and advertisement are towards reminder messages to remind customers about the product and reassure of the several benefits. Profits reduce drastically at this stage and few customers here are the late majority customers.
The final stage of the product life cycle is the declining stage; the product is dying at this stage. Revamping, relabeling and rebranding are the best strategies used at this stage.eg lifebuoy has rebranded, revamped and relabeled their product all over again.at this stage distribution are selective, channels that no longer profitable are faced out. Notwithstanding there are still few customers left at this stage, these customers are known as the laggards.
Laggards are people who find it difficult accepting change or take a longer time to change. They will therefore continue to use the product until it fades out totally from the market.
References
Mr. Gyau (2011), lecture notes
Retrieved from http://www.stanford.edu/class/ee353/product%20lifecycle.htm Retrieved from http://www.netmba.com/marketing/product/diffusion/
Beryl Naa Amorkor Adom
Level 300 (Weekend)
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