1E. PRODUCT LIFE CYCLE & its Management
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142 Terms
Pre- feasibility
Feasibility
Development
Executing and Testing
Project Launch and PIR
Project Life Cycles- Drivers of Internal Change
Detailed design
Commission
Operation and Maintenance
De-commission
Asset Life Cycle- Optimize Internal Operations
Pre- manufacture
Operation &manufacture
Product Usage
Product Disposal
Product Life Cycles- Profit Generated from Operations
Product takeback
Regulations
Recycling
Environmental
Today’s challenges include:
obligations
declarations
sustainability
climate protection
recyclability (waste)
life cycling
Tomorrow challenges:
project life cycle
specify the requirements
produce the design spec
develop the product and deliverables
do the user acceptance testing and authoring of the installation and support manuals
implementation- handover- customer satisfied
project life cycle
initiation
planning
executing
controlling
closing
product life cycle
is a conceptual representation of products' ageing process.
product life cycle
representative fact of the existence of every product.
product life cycle
a sequence or stages through which the individual products develop over a period of time
product life cycle
concept is derived from the fact that a given product’s volume and revenue follow a typical pattern of four –phases cycle
Philip Kotler
According to___: “PLC is an attempt to recognize the distinct stages in the sales history of the product.”
William J. Stanton
According to __: “The Product life cycle concept is the explanation of the product from its birth to death as a product exists in different stages & different competitive environments
Development
Introduction
Growth
Maturity
Decline
What are the 5 stages in PLC?
4 stages( Introduction, Growth, Maturity, Decline)
how many stages does typical PLC have?
5-life cycle stages
how many stages does pharmaceutical product have?
sales volume versus time
If plotted in a graph of___for a product, generally, the PLC represents a bell-shaped or sshaped curve
new product development
when there’s a new idea and made it to develop then there will be a
new product development
development of original products, improvement of products, product modifications and new brands through the firm's own R&D efforts
-innovation of
-creation of
-continuous improvement of
-enhancing utility of
Product development is a___ of new product/ existing product
concept screening
test marketing
what are the stage gates in new product development process?
idea generation
pool of ideas is created
idea screening
most feasible idea selected from the pool of
concept development
a concept is development and tested
business strategy development
marketing and other business strategies developed
product development
product prototype is created
test marketing
prototype introduced for researched feedback
commercialization
final briefing and strategy formulation is done
introduction
the product is introduced in the market
Incremental/ Derivative
Breakthrough/ Radical products
Next generation/ Platform products
Types of New Product Development
Incremental/ Derivative
Are hybrids or enhancements of existing product
Incremental/ Derivative
require minimal changes in design or process, allowing for quick development
Incremental/ Derivative
require fewer resources to develop new features or functions
Incremental/ Derivative
helps ensure near-team cashflows by maintaining current market shares
breakthrough/ radical product
represents “new systen” solutions for costumers
breakthrough/ radical product
require more sources to develop
breakthrough/ radical product
are key to continued product revenue growth
next generation/ platform prdoucts
create new product categories as core businesses
next generation/ platform products
require substantial design and process change
next generation/ platform products
render existing products obsolete in long-term
introduction stage
1st stage, wherein the product is launched in the market with full-scale production & marketing program
introduction stage
the product is a new one. It means “a product that opens up an entirely new market, replaces an existing product, or significantly broadens the market for an existing product.”
introduction stage
In this stage, sales grow at a very lower rate because it is not an effective demand yet
▪ Low & slow sales
▪ High product price
▪ Heavy promotional expenses
▪ Lack of knowledge
▪ Low profits
▪ Narrow product lines
Characteristics of introduction stage
low sales
introduction stage: sales
high cost per costumer
introduction stage: costs
negative
create product awareness and trial
introduction stage: profits & marketing objectives
offers a basic product
introduction stage: product
use cost- plus
introduction stage: price
build selective distribution
introduction stage: distribution
build product awareness among early adopters and dealers
introduction stage: awareness
rapid skimming
slow skimming
rapid penetration
slow prenetration
What are the marketing strategy used in introduction stage
rapid skimming
launching the new product at high price and high promotional level
slow skimming
launching the new product at high price and low promotional level
rapid penetration
launching of product at low price with heavy promotion
slow penetration
launching of product at low price with low level of promotion
growth stage
2nd stage, the market has started accepting the product, and sales begin to rise
growth stage
the product achieves considerable & widespread approval in the market
growth stage
effective distribution, advertising & and sales promotion are considered the key factors
▪ Product improvements
▪ Increase in competition
▪ Increase in profits
▪ Reduction in price
▪ Strengthening the distribution channel
characteristic of growth stage
rapidly rising sales
growth stage: sales
average cost per costumer
growth stage: costs
rising profits
growth stage: profits
maximize market share
growth stage: marketing objectives
offer product extensions, service, warranty
growth stage: product
price to penetrate market
growth stage: price
build intensive distribution
growth stage: distribution
build awareness and interest in the mass market
growth stage: advertising
improved product quality and add new product features and styling
add new models and products of different sizes, color, shapes etc.
enter new market segments
increase distribution coverage enter new distribution channels
shifts from product awareness to product preference advertising
lower prices to attract next layer of price sensitive buyers
marketing strategy used in growth stage
maturity stage
3rd stage, the market becomes saturated because the household demand is satisfied and distribution channels are full
maturity stage
the product has to face keen competition, which pressures prices. Though the sales of the product rise but at a lower rate
maturity stage
objective here is to defend market share while maximizing profit
▪ Sales increases at decreasing rate
▪ Normal promotional expenses
▪ Uniform & lower prices
▪ Product modifications
▪ Dealer’s support
▪ Profit margin decreases
Characteristics of maturity stage
peak sales
maturity stage: sales
low cost per costumer
maturity stage: costs
high profits
maturity stage: profits
maximize profit while defending market share
maturity stage: marketing objectives
diversify brand and model
maturity stage: product
price to match or best competitors
maturity stage: price
build more intensive distribution
maturity stage: distribution
stress brand differences and benefits
maturity stage: advertising
market modification
product modification
what are the marketing strategy used in maturity stage?
market modification
converting non users
market modification
entering new market segments
market modification
win competitors
market modification
redefine target market
product modification
quality improvement
product modification
adopting advance technology
product modification
product differentiation
decline stage
final stage, sooner or later, actual sales begin to fall under the impact of new product competition and changing consumer behavior
decline stage
the sales & profits fall down sharply & the promotional expenditure has to be cut down drastically.
▪ Rapid decrease in sales
▪ Further decrease in prices
▪ No promotional expenses
▪ Suspension of production work
Characteristics of decline stage
declining sales
decline stage: sales
low cost per costumer
decline stage: costs
declining profits
decline stage: profits
reduce expenditure and milk the brand
decline stage: marketing objectives
phase out weak items
decline stage: product
cut price
decline stage: price
go selective: phase out unprofitable outlets
decline stage: distribution
reduce to level needed to retain
decline stage: advertising
Note 
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