Infographic: 5 measures for extending the product lifecycle
If you want to establish your product in the highly competitive digital market, you need to be able to forecast the product lifecycle and pull the right levers at the right time in order to control it.
5 life stages: what is the product lifecycle?
The product lifecycle is a marketing concept that describes the time between a product’s market entry and its market exit. In light of increasingly dynamic development moving toward agile product development, frequent disruptions, growing competition on globalized markets, and technical innovations, product lifecycles are getting shorter and shorter. That applies to digital devices and, in particular, the digital goods segment.
Every product goes through several stages from when it is introduced on the market until a time when it no longer sells well enough and reaches the end of its lifecycle. A typical product lifecycle can be depicted as a 5-stage model. These 5 stages are as follows:
- Introduction: market entry up to break-even
- Growth: until the growth rate falls
- Maturity: maximum sales volume up to market saturation
- Saturation: sales stagnation up to a drop in turnover and demand
- Decline: further decrease in turnover and demand until market exit
A completed cycle either results in
- the product being withdrawn from the market, or
- it being modified and repositioned.
With the right know-how and a suitable marketing strategy, such a modified product can pass through another product lifecycle. In our free “Extending the product lifecycle – 5 stages, 5 measures” infographic , you can find out more about the 5 product lifecycle stages.
Passing through an entire product lifecycle is not a completely automatic process, of course. Many products already flop during the introduction stage, do not reach the profit threshold to break even, and are discontinued before they even get to the growth stage.
Appropriate measures therefore need to be taken in each stage to facilitate the transition to the next stage or delay the transition to the negative “saturation” and “decline” stages. The business concept of product lifecycle management (PLM) comprises the integration of all the information and measures that arise during a product lifecycle.
5 measures for extending your product lifecycle
The product lifecycle can be controlled using corresponding marketing measures. A suitable marketing mix is based on the four pillars of product policy, pricing policy, communication policy, and distribution policy, and must take the following factors into account:
- The specific product features
- The requirements of customers
- The target group’s acceptance
- The product’s benefits
- The competition
- The market launch strategy
- The resources for performing on the market and involving customers
Effective measures of this approach for extending the product lifecycle include:
- Advertising, PR, marketing, and promotion
- Optimizing the product
- Tapping into new markets
- Reducing the price
- Influencing consumer behavior
However, not all of these five measures are equally suitable across the board for each product lifecycle stage. Each measure must be based on a sound analysis of the market situation and implemented using specific tools that are tailored to the individual product as well as the market conditions and target group. Turnover and profit forecasts need to be used to create the right marketing mix and decide on suitable measures at the right time.
Our free infographic “Extending the product lifecycle – 5 stages, 5 measures” shows you when to implement which measures in the most effective way.
Every ending is a new beginning: aligning product planning with the product lifecycle
The basis prerequisites for every measure used to influence the product lifecycle are:
- Continuous monitoring and analysis of the market development
- Constant readiness for further development
- Sensible investments in marketing activities
- Optimization of marketing strategies before the market introduction
In some cases, it may be beneficial to cut down on marketing expenses as early as during the growth stage and invest those resources in further developing the product. This way, profits generated after the break-even point can help to lay the foundation for a long product lifecycle.
During the saturation stage, you need to identify the right time to stop all investments in the current product, redistribute them to the further development of a successor product, and support the latter’s market launch by taking appropriate marketing measures. Product planning should thus be thoroughly geared to the product lifecycle.
Dominance over the product lifecycle: the iPhone as an example
When Apple presented its iPhone to the public in early 2007 after years of development, the touch control and app functionality were disruptive, revolutionary innovations that made the brand stand out and sell like hotcakes. However, if Apple had rested on the laurels of this release and had not continuously enhanced its iPhone, refined its technologies and added more features since then, it would have very quickly forfeited its market position.
Other companies soon followed suit and started offering comparable products of a similarly high quality. Apple has only maintained its standing and brand awareness to date through continuous innovation and further development of its product. After all, no model can continue to meet the highest possible standard of state-of-the-art technology over long periods of time. All of the hardware components as well as the software must be improved in certain cycles in order to maintain the acquired market position.
However, that will only work if the development of new variants and the optimization of the product are constantly driven forward and a relaunch or facelift model of the product is released at a suitable time during the predecessor model’s product lifecycle. In the case of the iPhone, the technological cycle and constant further development therefore sustain the lifecycle. The product lifecycles of the various models seamlessly intertwine with one another. However, this success would not have been possible without knowledge of the market situation, the performance of competitors, and suitable marketing measures for specifically controlling and extending the product lifecycle.
Free infographic: extending the product lifecycle – 5 stages, 5 measures
If you too want to keep on top of and specifically manage your product lifecycle, you should be familiar with its 5 stages, their specific characteristics, and suitable measures that you can take during each of them. Our free infographic provides you with a compact overview of these aspects.