The product life cycle describes the various stages a product goes through, from its launch to a possible decline in demand.
The model helps companies and start-ups to better assess a product’s current market position and to make appropriate decisions regarding marketing, pricing, sales and further development.
Typically, the product life cycle consists of five phases:
| Phase | Typical characteristics |
| Introduction | The product is new to the market. Brand awareness, sales volume and turnover are low to begin with. |
| Growth | Demand is rising, new customers are being attracted and the first competitors are entering the market. |
| Maturity | The product is well established. Growth is slowing and competition is increasing. |
| Saturation | The market has largely been exhausted. Sales are stagnating or beginning to fall. |
| Decline | Demand is falling significantly, for example as a result of new technologies or changes in customers’ needs. |
During the introductory phase, the focus is often on the following tasks:
- Building brand awareness
- Attract your first customers
- Gathering feedback from the market
- Improving the product and its positioning
- test suitable distribution channels
During the growth phase, the main focus is on:
- To expand production and sales structures
- to tap into new target groups or markets
- to strengthen the brand
- to differentiate the offering from that of competitors
- to meet rising demand reliably
During the maturity and saturation phases, companies can, for example:
- develop new features
- Offer product variants
- Adjusting prices and business models
- reach out to additional target groups
- Optimising processes and costs
The product life cycle is not the same for every product. Some products remain successful for many years, whilst others are quickly replaced by new technologies, trends or offerings.
Even a decline does not automatically mean that a product has to be discontinued. The product life cycle can be extended through further development, repositioning or the expansion into new markets.
innoWerft helps start-up founders to identify market changes at an early stage, refine their products based on customer feedback, and develop appropriate strategies for growth, positioning and innovation.