Month End Glossary

Product Life Cycle

The product life cycle refers to the stages a product goes through from its introduction to its withdrawal from the market.

The product life cycle describes the journey of a product from its development and introduction into the market, its growth and peak in popularity, to its decline and eventual removal from the market. This lifecycle is generally divided into four stages: introduction, growth, maturity, and decline. During the introduction stage, a product is launched and marketing efforts are focused on creating awareness. In the growth stage, the product gains traction, increases in sales, and competitors may enter the market. The maturity stage occurs when the product achieves market saturation, and sales growth slows down. Finally, in the decline stage, the product faces reduced demand and may eventually be phased out. For instance, a new smartphone model goes from being a novel product, to gaining popularity, to becoming a commonplace item, and eventually being replaced by newer technologies. Understanding the product life cycle helps businesses strategize effectively for product development, marketing, and resource allocation.

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