Product and Service Life Cycle

5
223

Similar to people, products and services have life cycles. They move from birth, through a period of growth, to maturity, and then level off somewhat before declining toward their demise. The decision on whether or not to produce or provide a particular product or service should depend, in part, on what stage of the life cycle the product or service is in. Some products or services have a short life cycle (pet rocks), while others enjoy more prolonged lives (picture frames).

It is important to understand the life cycle concept, so the proper form of advertising and promotion can be used. Knowing the life cycle of your product or service can also help you determine if you need to redesign or drop a product line. There are four stages in the product or service life cycle:

1. Introduction

In this stage, the new product or service is launched. The first barrier to overcome is customer lack of awareness of the product or service. Because people are unaware of the product or service, sales may rise very slowly, and promotional costs will probably be high. Promotional emphasis is on introducing the product or service to your customer and attempting to have people try the product for the first time.

2. Growth

In this stage, sales start climbing. Presumably you are beginning to make a profit. This may attract new competitors to enter the market bringing new product or service features. The market will expand as more people buy the product, profits rise and prices remain stable.

3. Maturity

In this stage, sales peak to create high profits. However, an over abundance of suppliers leads to greater competition. Weaker competitors start dropping out.

4. Decline

In this stage, sales decline and more firms withdraw from the market. Prices are reduced; profits decline and weaker products and services are phased out.

Interestingly, a new innovation can take a declining product or service life cycle and generate a whole new life cycle. For instance, Dentifrice at one point was only available as a powder, and then toothpaste was developed to rejuvenate a whole industry. When you hear the claim “new” or “improved” the advertiser is trying to rejuvenate the product or service life cycle.

Person marketing

People are also marketable. Politicians, entertainers, sports figures and professional; such as lawyers, accountants and architects; market themselves. The objective of persona marketing is to get your customers to view the person being marketed as a celebrity or expert. Marketing people is similar to marketing other products/services. Through market research and analysis you discover the customers’ needs, segment the market, develop the product/service then develop programs to value, promote and deliver the celebrity or expert.

Social marketing

Social marketing is generally used to seek the acceptance of a social cause or idea such as public health campaigns. The objectives may differ from the ordinary business, i.e. to make a profit, to ones focused on social change, which encourage understanding or trigger an action (write to your Member of Parliament). To promote social change, social marketers, follow the same approach as those marketing products, services, ideas, people or places.

Service marketing

Since each interaction with the customer is unique, service marketing requires more than the traditional 4 Ps of marketing. It also involves ensuring that employees in the company are all customer oriented. Employees must be trained and motivated to always ensure customer satisfaction. Interacting with the customer is key to good service. The customer will measure the quality of the service based on the quality of the interaction. For example, sales or service staff may have a strong customer orientation and desire to serve the customer, but they are held back by administrative nightmares that slow the service delivery, which decreases customer satisfaction. All employees must be committed to providing the marketing services which result in satisfied customers.

Since offering a service is mostly intangible, you cannot see touch or taste the service, the physical evidence that supports the service is important. For example, if you are providing expert, professional business advice, then your surroundings must reflect this type of service. The customer will look to the physical environment to provide some sort of tangible evidence. If your receptionist allows the phone to ring while she chats with a co-worker, your customer sees lack of customer service. On the other hand, if your office is neat, clean and tastefully decorated, your customer sees the professionalism you have promoted.

5 COMMENTS

  1. I don’t even know how I ended up here, but I thought this post was good. I do not know who you are but definitely you’re going to a famous blogger if you aren’t already 😉 Cheers!

  2. You can definitely see your enthusiasm in the work you write. The world hopes for more passionate writers like you who aren’t afraid to say how they believe. Always follow your heart.

Comments are closed.