Product Lifecycle

Question 1

What is a product lifecycle?

Answer 1

The stages through which a product goes once it is on sale.

Question 2

What are the 4 stages of the product lifecycle?

Answer 2

Introduction to Market
Growth
Maturity
Decline

Question 3

What are profits and sales like during the ‘Introduction to Market’ stage of the product lifecycle?

Answer 3

It is generally a period of slow sales as a product is launched. Because of the high costs of developing and advertising a new product, profits are small at this stage.

Question 4

What happens to profits during the ‘growth’ stage of the product lifecycle? Why?

Answer 4

The popularity of the product increases and more people want to buy the product, which boosts profits.

Question 5

What happens during the ‘maturity’ stage of the product lifecycle? Why?

Answer 5

Eventually demand (and profit) hits its peak as most of those who are going to buy the product have done so. By now, competitors will also have launched their products and this too affects sales.

Question 6

What happens during the ‘decline’ stage of the product lifecycle?

Answer 6

The sales of the product begin to slow down and profits reduce.