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The phases of the product life cycle are launch, growth, maturity, and decline. Each phase of the life cycle needs to be marketed differently to consumers. Life cycle marketing is the practice of promoting, selling, and distributing a product through the different phases of its life cycle.
When a new product is released into the market, the focus is on creating awareness and making sure consumers understand the product features and benefits. During the launch phase, distribution may be limited as the product is targeted to early adopters and innovators. Pricing in the launch phase can be at a premium to recoup development costs or lower than the target price to encourage rapid market share building.
The growth phase of the product life cycle typically capitalizes on the launch momentum to introduce the product to a larger audience. During this period, a product tends to expand from the early adopters to the mainstream. Messaging in this phase of life cycle marketing focuses on differentiating the product from others in the category. Products that launched with limited distribution are rolled out to more markets during this phase.
Products in the maturity phase have reached the peak of expansion and market saturation. Life cycle marketing during maturity focuses on defending market share. To maximize profitability, the company will try to not lower prices during maturity, but increased competition may force price decreases. If possible, the company may add features to the mature product to further differentiate it from competitive offerings.
Decline is the final stage in the product life cycle. Often companies launch a newer version or model of the product in decline. This can lead to a surge in sales of the older product at reduced prices. When a newer version of the product is not introduced, the company will either discontinue the product or drastically reduce production if there is still a niche market. Life cycle marketing messages for declining products typically focus on price as opposed to features and benefits.
Not all products follow the typical product life cycle. Advances by the company or competitors may alter the order of the life cycle or skip phases entirely. Customer behavior may differ from the expectations during the different phases, requiring close tracking of customer and market data. A successful life cycle marketing plan needs to be able to adapt to changing market conditions with alterations when needed.