The growth stage is marked by rapidly increasing sales, market expansion, and high levels of profit. Marketing activity increases substantially in the growth stage. The rate of new product introductions intensifies in the growth stage.
The maturity stage is characterized by slowing sales growth, industry stability, and stabilized profitability leading to the presence of "cash cows" within an industry or segment. The rate of new product introductions decreases in the maturity stage, as participants in the industry or segment begin to rely more heavily on product differentiation.
New product introductions drop off markedly in the decline stage, sales revenues decline rapidly, and profitability begins to evaporate. Participants in an industry or segment begin to eliminate some products.
Organizational factors which must be considered with respect to the life cycle stages include (a) costs, (b) production efficiency, (c) cash requirements, (d) product development, and (e) profitability. Costs are highest in the earlier stages. Production efficiency is highest in the middle stages. Product development is highest in the earlier stages. Profitability is highest in the middle stages.
Environmental factors which must be considered with respect to the life cycle stages include (a) competition, (b) consumer awareness, (c) demand, (d) pricing, and (e) distribution. Competition tends to increase across the life cycle. Consumer awareness and demand are highest in the middle stages. Pricing and distribution increase through the growth stage before stabilizing in the maturity stage and falling in the decline stage.
Marketing factors which must be considered with respect to the life cycle stages include (a) demand stimulation, (b) distribution planning, (c) pricing tactics, (d) product characteristics, and (e) target marketing and segmentation. Demand stimulation and distribution planning are most intensive in the earlier stages. ...
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