THE DECLINE STAGE
Products are rapidly losing ground to new technologies and product alternatives
Decrease in sales and profits
Product lifecycle is extended through sales to consumers in developingcountries
A new product is introduced onto the Marketplace, few people know about it, and itssuccess is rarely guaranteed. Much time and money is invested in promoting this product,and there is either no profit or even a net loss during this period.
The product starts to grow in popularity, sales increase as advertising starts working andothers start to imitate your product. Profits increase, and your product steadily becomes asuccess.
Your product becomes an established part of the Market, but sales start to increase slowlyas competition and pricing factors take place. At this stage advertising costs are at their highest, whilst profits may start to drop. The market for your product could reachsaturation point.
Sales start to fall, as your product loses its appeal. Profits drop as production is often cut,competition in the marketplace gets stiffer as advertising is cut and plans are made toshelve the product in the future.
Innovators take your product and may incorporate it into a new product. This hashappened to the humble FM radio and Camera which you find as a basic feature on mosthand phones. The decline of the original product has just lead onto the use of it on a verynew product.
The product Life Cycle may not end it changes, especially in this century of fast moving technology. Traditionally products faded away into the memories of their users, but haveoften become part of a new product, that faces the same decline in the future.