The Product life Cycle

Question 1

What is the product life cycle ?

Answer 1

A theoretical model which describes the stages a product goes through.

Question 2

Name the stages in the product life cycle

Answer 2

Introduction
Growth
Maturity
Decline

Question 3

Describe the introduction stage

Answer 3

The introduction stage is where a company tries to build awareness of the product or service. Pricing the product in this stage is very important to gain market share. A popular pricing strategy is the skimming pricing strategy, the price is high for customers who are willing to buy the product

Question 4

Explain the growth stage in the product life cycle

Answer 4

This is a key stage for establishing a products position in a market, increasing sales and improving profit margins. This is achieved by the continued development of consumer demand through the use of market and promotional activity. How soon the product moved from introduction to growth varies from one market to the other.

Question 5

Describe the maturity stage in the product life cycle

Answer 5

This shows that seals will eventually peak and slow down. Sales growth has started to slow down, the product has already reached a wide spread of acceptance in the market.

Question 6

Explain the decline stage in the product life cycle

Answer 6

A fall/descent, When a product dissolves as a result of decreased or negative growth.

Question 7

What are some examples of extension strategies

Answer 7

Rebranding 
Repackaging
Price reductions
Targeting a new market
Developing the market i.e. moving to another country
Celebrity endorsement
New ranges, more benefits
Changing distribution methods

Question 8

What are the causes of a shorter product life-cycle

Answer 8

The rate of technological change is rapid
There is high innovation in the market
Customers Tastes change Rapidly
The product is a fashion item
The product is badly marketed