The Product Life Cycle

CLARITY MAPULANGA, C22150193R

CHARTON SAMUEL M, C18133979W

HILDA, HARAHWA C22148774F

MADA TONDERAI C109476Z

VIMBAINASHE MARUME C22152957D

GROUP 8 :GIVING PRACTICAL EXAMPLES ,EXPLAIN IN

DETAIL THE PRODUCT LIFE CYCLE WITH RESPECT TO
SUPPLY CHAIN MANAGEMENT
 INTRUDUCTION
 The Life cycle (LC) concept was and now has become widely adopted as a
framework for the interpretation and evaluation of products. The application of
the LC concept to the development of industrial products is an important element
in the administration of technological innovation.
 On this basis, therefore, it is referred to as the Product Life Cycle (PLC). The
management of the product development process is supported with the adoption
of the product life cycle (PLC) concept, which is used as a decision- making tool.
 The PLC is used to describe the performance of the product as it advances
through its life phases, from initial development until it is retired in order to fully
exploit the utility of and the possibilities for profit at each phase of the life cycle.
(Giudice at al 2006)
OBJECTIVES

 With this in mind, the PLC becomes a representation of the

product’s market history and each phase is characterized by the
trend of sales volumes and profit performance . This supports the
managers’ decision-making efforts regarding possible intervention
strategies and objectives. Horvat, S., 2013.
 While the product is in the market, the PLC phases are:
Development, introduction, growth, maturity and decline
Horvat, S., 2013.
OBJECTIVES
 Introduce the product life cycle

 Introduce the marketing objectives at each stage of a life cycle

 Identify the marketing mix options for each stage

 Strategies to operationalize plc

 New products :concepts and strategies

PLC IN A NUTSHELL
P.L.C in operations
Products tend to go through different stages being affected by
different competitive conditions.
The length of a product’s life cycle is in no way a fixed period of
time .It can last from weeks to years depending on the type of product

The degree of adjustment to the competitive environment, determines

the success of its life.

Elements of marketing mix (4Ps) need to be adjusted at various stages

of PRODUCT LIFE CYCLE
 1. DEVELOPMENT STAGE
 New product development involves complex and absorbs significant resources and the
expectation might not be successful. Lead times may take longer period of time
before sales are accomplished.
 The 2000s witnessed the birth of Samsung’s Galaxy smartphone series, which quickly
not only became the company’s most-praised products but also were among the best-
selling smartphones in the world.
Product Life Cycle–Sumsung
Introductory Stage 2001-2006
DEFINITION INTRODUCTION CHARACTERISTICS
 This is where a new product will be  SALES LOW SALES
launched.
 This phase occurs once a new product is  COSTS HIGH COSTS PER CUSTOMER
conceived, fabricated and made avail-
able in the market . This stage requires  PROFIT NAGATIVE
substantial investment because the
product has to be accorded the best  CUSTOMERS INNOVATORS
opportunity to yield profit
 COMPETITORS FEW
Product Life Cycle–
Introductory Stage
MARKETING OBJECTIVES

CREATE PRODUCT AWARENESS AND TRAIL

 Product Life Cycle–
Introductory Stage
STRATEGIES

a) PRODUCT
Offer a basic product

Launched few models due to lesser demand

Launched 1st samsung with simple display

B)PRICE

Followed penetration pricing strategy

Product Life Cycle–
Introductory Stage
C) Distribution

Build Selective Distribution

D) Advertising

Advertisement In Print Media

Build Product Awareness In Early Adaptors And Dealers

F) Sales Promotion

Samsung Follow Discounting Policy As Per Mobile Phone

Offered Good Amount Profit To Retailers

Product life cycle –Growth stage 2006-
2011
GROWTH STAGE CHARACTERISTICS
 In this stage, the sales will be increasing  SALES - rapidly increasingly
as the product gains the market  COSTS – average cost per customer
acceptance.
 PROFIT – rising Cost
 The market grows, profits rise at the same
time attracts the entry of new  CUSTOMERS- early adapters
competitors.  COMPETITORS – growth in numbers
 As the market grows, the cash flow will
also increase and give a positive picture
on the profits to be realised.
Product life cycle –
growth stage
MARKETING OBJECTIVES MAXIMIZE MARKET SHARE
Product life cycle –
growth stage
STRATEGIES

Product Offer Product Extensions ,Service, Warranty

Price Price To Penetrate Market

Distribution Build Intensive Distribution

Advertising Build Awareness And Interest In The Mass Market

Sales Promotion Reduce To Take Advantage Of Heavy Consumer Demand

Product life cycle –Maturity Stage 2011-
TILL NOW
DEFINITION
SAMPLE OF PHONES AT  At this phase, the PLC curve begins to flatten out, organizations
are more concerned about maintaining their share of the market,
MATURITY and therefore the mere existence of the product is not given a
second thought. The maturity stage is known to last longer than
others
 There will be intense competition and battling for market
share is experienced. In this stage the SWOT analysis will be
an ideal tool to be used as analysis from the view point of
internal business activities on the company’s strengths and
weaknesses will be monitored as well as taking into cognisance
the external opportunities and threats.
 The strengths will depend on the high market share for higher
profits.
 Opportunities will lie on the weaker competitors who will start
to leave the market whilst the cash flow should be strongly
positive resulting in less need for investment and marketing.
 Usually bigger profits are expected from the new product.
Product life cycle –maturity
stage 2011-TILL NOW
CHARACTERISTICS
SALES LOWER SALES DUE TO GROWTH AS RIVAL ENTER THE MARKET

COSTS LOW COST PER CUSTOMER

PROFIT HIGH PROFITS

CUSTOMERS MIDDLE MAJORITY

COMPETITORS STABLE NUMBER BEGINNING TO DECLINE

Product life cycle –
maturity stage
MARKETING OBJECTIVES
MAXIMISE PROFITS WHILE DEFENDING MARKET SHARE
Product life cycle –
maturity stage
STRATEGIES

A)PRODUCT- DIVERSIFY BRANDS AND MODELS

B) PRICE -PRICE TO MATCH OR BEAT COMPETITORS

C) ADVERTISING-STRESS BRAND DIFFERENCES AND BENEFITS

D) SALES PROMOTION - INCREASE TO DISCOURAGE BRAND SWITCHING

 REFERENCES
 Giudice, F., La Rosa, G., Risitano, A., 2006. Product Design for the
Environment [Electronic Resource] : A Life-Cycle Approach/Fabio Giudice,
Guido La Rosa, Antonino Risitano. Hoboken: CRC Press.
  Horvat, S., 2013. Application of product life cycle concept to private label
management. Trziste/Market 25, 63-75.
 H., Folan, P., 2012. Product life cycle: The evolution of a paradigm and
literature review from 1950-2009. Production Planning & Control 23,641-
662.
 Aitken, J., Childerhouse, P., Towill, D., 2003. The impact of product life cycle
on supply chain strategy. International Journal of Production Economics 85,
127-140.
Thank you!!!!!
TINOTENDA, SIYABONGA.