Stages of product life cycle are :
Growth : It is the period during which the product is accepted by consumers, and holders. During the growth stage, the rate of increase of sales turnover is very rapid. Profits so increase at an accelerated rate. In spite of competition, we may have rising sales and profits. The firm gives top priority to sales volume and quality maintenance may have condary preference. For marketing success, manufacturing and distribution efficiency are factors. In mathematical term, the end of the growth period is at the inflection point on sales curve. In this stage effective distribution and advertising are considered as key factor. Word of mouth advertising leads to more new users. Repeat orders are secured
Maturing : During this stage keen competition brings pressure on prices. Increasing marketing expenditure and falling prices (in the battle for market share) will reduce profits. Additional expenditure is involved in product modification and improvement or broadening product line. Marketers have to adopt measures to stimulate demand and face competition through additional advertising and sales promotion. Overall marketing effectiveness becomes to the key factor in the stage of maturity. Low prices, increasing competition, rising marketing and declining profits are the features in this stage.
Saturation: The saturation point occurs in the market when all potential buyers are using product and we have only replacement sales Consumption achieves a constant rate and marketers have to concentrate exclusively on a fight for market share (with higher marketing expenses). Prices may fall rapidly and profit margins may become small unless the firm makes substantial improvements and realizes cost economies.
Decline Stage : Once the peak or saturation point is reached, product inevitably enters the decline stage and becomes obsolete. It may gradually displaced by some new innovation. Sales drop severely, competition dwindle, and even then the product cannot stand in the market. It may be priced out of the market by other new innovations. A marketer is expected to keep new products ready to fill up the gap
created by the demise of existing products. At this stage price becomes the primary weapon of competition, and we have to considerably reduce expenditure on advertising and sales promotion. Cost control becomes the key to generate profits.
