Four Reasons for Classifying Products in Accordance with

Product Life Cycle

1. To identify products and related lines that are continuously generating sales
or not performing at all based on goals for the period of product review.
2. To determine appropriate allocation of resources on products with potential
for growth or products to be phased out or discontinued.
3. To effectively implement immediate impact programs on products deemed to
have a potential for long-term growth and leadership.
4. To match or pinpoint direct competitors products, for market growth and
market share dominance.
When a product dies a natural death or reach obsolescence or sales performance
below zero lever or negative growth rate for the period compared to the previous
years, companies find it very difficult to bring it back to life or to the growth stage,
because target markets may have already negative perceptions, feeling or
impressions in their sub-conscious minds for the product. A company may, however,
insist on re-investing for a dead product in the marketplace if in their readings of
the market, there exists such potentials for revival and ultimately full recovery and
growth.
A product that died a natural death in a target market segment may be revived or
re-introduced in the same segment but this time under a new brand name or its
basic features partly modified or reformulated or improved. The product re-launch
should creatively communicate to target clients the valued-added features against
competing brand.