One important thing to be concerned about by business owners is the product movement or familiarity with the term product life cycle. This cycle becomes a very important component to find out how the business products move during this time. Not only that, this concept can be used as a consideration for product marketing activities. There are five important stages in the product life cycle that you need to know. What are the explanations for these five stages? Check out the full explanation below!
Table of Content
Product Life Cycle Definition
The product life cycle is the process of a product, ranging from product launch to product decline from the market. This concept is often used to find out how the product develops in the market. So, business owners can determine several strategies to develop their product, such as expanding market reach, increasing marketing ads, and redesigning product packaging.
Also read: Opportunity Cost: Definition, Function, and Calculation Method
Product Life Cycle Stages
You need to know that there are five important stages in the product life cycle. These five important stages include product development to product decline. What is the explanation of each stage? Let’s take a look at the following explanation:
Development
This first product life cycle stage becomes the determining stage of a product in the future. At this stage, business owners will develop the product well. Besides developing the product, there will be product testing to know its effectiveness in this stage. The development stage often requires a huge cost. Therefore, business owners usually get funding from investors or entrepreneurs at this stage.
Introduction
After the product development stage has been completed, the next step is introducing the product to the public. Product recognition to the public aims to build product awareness in the community and develop a broader market scope. At this stage, marketing activity has become an important component. So, business owners have to spend high marketing costs to get potential customers.
Growth
At this stage, business owners will get high product demand from the customer. So, business owners will get increased sales and profits. This is the aftermath of successful product marketing activity in the previous stage. The business owners can get new sellers and distributors who want to take advantage of this high product demand.
Maturity
The maturity stage in the product life cycle is characterized by the presence of competitors on your business products. Therefore, as a business owner, you must determine the right strategies to face the existing competitors. One of the most important strategies to face competitors at this stage is to innovate and increase product marketing activities.
Decline
In this stage, your business product will experience a decrease in product demand. Decreased product demand will certainly result in lower sales and customer behavior changes. The main cause of customer behavior changes is switching to another product. This stage will later lead to the product’s exit from the market.
Factors that Affect the Product Life Cycle
Several factors affect the product life cycle, ranging from technological advances to the presence of competitors. So, what is the explanation of each factor? Check out the following explanation:
Technological advances
As we know that in today’s modern era, all aspects of life are supported by cutting-edge technology. It can be said that the technological advancement factor is the most significant factor that can affect the company’s product life cycle. Business owners can utilize technological advances so their products can survive in the market.
Value changes
The next factor that can affect is the value changes. There are several causes of value changes. One of them is a community view that requires someone to use certain products or materials. A relevant example in today’s modern era is the selection of environmentally friendly products that certainly has a high value.
Presence of competitors
Many emerging competitors will certainly affect the product flow cycle. Usually, competitors come with cheaper products and better materials. So, not a few people switch to choosing competitors’ products. Therefore, you must determine the right strategies in facing the competitors.
Political and economic conditions
The country and world political and economic stability are also one of the factors that can affect the product life cycle. The country’s economic capabilities will show how many customers are loyal to your product. However, a financial crisis will cause decreased customers.
Also read: Why is Content Marketing Important for Business?
Conclusion
To conclude, the product flow cycle is the process of a product, ranging from product launches to product decline from the market. This concept is often used to find out how the product develops in the market. This concept has five important stages, ranging from product development to product decline. Several factors also affect this concept, such as the country’s political and economic conditions, technological advances, and the presence of competitors.
Furthermore, speaking of the presence of competitors, HashMicro as a leading ERP Software provider presents the best solutions to make your business step ahead of the competitors using Hash CORE ERP. Therefore, ERP software comes with various features to increase business productivity and profitability. What are you waiting for? You can start HashMicro’s Core ERP Software demo for free now.
