In terms of international marketing, the life cycle of a product is how it gradually evolves over time and sustains ups and downs in the market across different countries. The stages of the life cycle of a product is strongly affected by the domestic and international marketing policies of the company making that particular product. In all the import export courses online, you will definitely see a topic covering the product life cycle as it is the basis of domestic and international marketing. In this article, we will see all the 5 stages of the product life cycle in brief.
5 Stages of the Product Life Cycle
From the introduction of a product, sales volume and growth are the other two factors that affect the life cycle of the product. The 5 stages are discussed below
- Introduction
Introduction stage of any product is the stage where the product is firstly introduced in the domestic market with no international market presence whatsoever. In this stage, there is no demand or very less demand for the product as the product has a very limited exposure to the customer. Only people interested in the product at this stage are the ones who know little bit about the potential of the product and are even ready to pay higher prices keeping in view the future demand.
- Growth
Growth is the stage where after the effective marketing of the product, it meets its target market. Growth stage in the international market is the stage where the exporter starts to research about the demand of his product in the international market, conducts different surveys in the market and analyzes the potential growth of his business. In the growth stage, the sales volume shoots up because of the high promotion of the product and less margin in the initial stages which is why the competition is comparatively lower. Prices of the products in this stage fluctuates as everything is adjusted in the initial stages.
- Maturity
Maturity is the stage of the product where the product is matured and established in the market as due to excessive promotion and marketing of the product, its demand increases in the international market. Since the product is not new anymore, the sales increase slowly and steadily. After all the initial adjustments, the prices of the products are fixed which is the reason why the profit margin is decreased. Since the product is well established in the market by now, the business grows continuously which compensates for the decreased profit margin
- Saturation
After the growth and maturity stage, there comes a stage where the further possibility of the sales of the product is negligible and this stage is called the saturation stage. The sales of the product at this stage is considered to be at the peak. The sales of the product continues until a substitute of the product enters the market and as soon as this happens, the owner of the product discontinues it. If the owner does not want to discontinue the product, he must develop new and alternative use of the product.
- Decline
In this stage, the sales of the product falls drastically and hence is discontinued from the market. This is considered to be the final stage of the product after which only bringing a new product to the market is the option. Other countries that have developed similar products at better prices and better functioning start supplying them to that particular market and the best option that remains with the owner of the original product is to sell off those products at discounted price and introduce new ones.