product life cycle

The stages through which a product passes from development to being withdrawn from the market. The first stage is the development stage, when a product is designed. Then comes the launch of the product, which is likely to be associated with informative advertising and promotion because consumers need to be made aware that the product is now available on the market and what its purpose is. The next stage is the growth stage, as sales and revenue increase. Then comes a period of maturity for the product when sales and revenue level off. Competitors may have entered the market, taking away growth of the product. Or the market may have become saturated. Finally, the product goes into decline as sales fall.

Some products, such as pop records and fashion clothes, have very short product life cycles. Other products, such as salt and sugar, have life cycles which remain perpetually at the maturity stage. Business organizations attempt to prolong the maturity stage of the life cycle through persuasive advertising and promotion and simple product development.