Product Life Cycle Flashcards, test questions and answers

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What is Product Life Cycle?

A product life cycle is a marketing concept that describes the stages of a product or service from its introduction to the market, through growth, maturity and decline. It is used by marketers to decide when, how and where to launch products, manage them over time and develop strategies for new ones. The general idea behind the product life cycle is that all products have a beginning, middle and end.The first stage in the product life cycle is introduction. This stage involves researching potential markets and developing an appropriate marketing mix price points, promotional activities (e.g., advertising campaigns), distribution channels to bring your offering to market. During this stage it’s common for companies to spend more than they make on their new product as they strive to reach their target audience with information about what makes their offering unique or desirable compared with existing options in the marketplace. In this sense, launching a new product requires significant investment often without immediate returns; however, if successful it can provide long-term financial benefits for businesses that are willing to take risks on innovative offerings. Once consumers become aware of a new offering through promotion or word of mouth it enters into its growth phase during which sales increase rapidly alongside greater brand recognition across different demographics as well as geographical regions potentially opening up further opportunities for expansion later down line. Here companies may still be spending more on marketing than they are making but at least now there should be some indication of positive ROI given growing consumer interest rates in their products/services helping sustain future investments in other areas such as research & development (R&D).When demand reaches peak capacity then we enter into our third stage: maturity aka the plateau where profits begin stabilizing despite continued efforts towards innovation aimed at prolonging customer loyalty – whether this be through additional features like subscription services or expanded warranties etcetera . Companies may also look into diversifying within related markets by introducing variations of existing offerings so as not too saturate one particular segment while maintaining overall profitability levels throughout these changes over time.