Life Cycle of a Product

What is the life cycle of a product

The life cycle of a product (CVP) defines the stages that a product passes from its birth to its decline.

The life cycle of a product is a term coined for the first time in 1965 by the American economist Theodore Levitt in his article “Exploiting the life cycle of a product” for the publication Harvard Business Review.

Knowledge about the life cycle of a service or product is important to be able to identify the stage in which the product is in order to generate the appropriate strategy in order to reintroduce, relaunch or redesign the good or service to perpetuate its income.

in marketing or marketingPhilip Kotler defines the life cycle of a product as the stages that a good or service goes through, defined by the profits and losses that are generated.

Stages of the life cycle of a product

Levitt’s product life cycle chart features four stages: introduction, growth, maturity, and decline, with the stage of maturity being where you will generate the most profit.

Types of product life cycles

In management, the aim is to keep the product within the maturity phase for as long as possible. For this, strategies of marketing, advertising and campaigns to alter the behavior of the cycle. Several types of life cycles that products can present are defined:

  • classic cycle: as its name indicates, it presents the classic behavior defined by Levitt.
  • Stable maturity cycle: no signs of decline.
  • cycle-recycle: classic cycles where there are small highs and lows that fluctuate between growth and decline.
  • Cycle of increasing sales or decreasing sales: indicate profit or loss trend.
  • Residual Market Cycle: represents the use of what remains of the market at the end of the product’s life cycle due to the extinction of the market in which it is found.
  • Fast penetration cycle: the stage of development or introduction of the product is reduced, which means a lower picture of initial investment losses.
  • Cycle of successive relaunches: seeks to maintain constant growth with minimal and predictable declines.
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Product life cycle example

All goods or services have a life cycle and the time spent in the different stages depends on the executed marketing plan. A real example of the life cycle of a product is that of the Coca-Cola beverage that was introduced on the market in 1886 as a medicinal drink.

In its growth stage, the Coca-Cola product is transformed into a carbonated beverage with a distinctive bottle in 1915, accompanied by a strong advertising campaign that emphasizes its flavor.

Coca-Cola reaches its stage of maturity with its global marketing. Coca-Cola’s marketing plans have kept the product mature for more than 100 years by introducing the drink in cans, advertising campaigns emphasizing values ​​such as friendship and joy, and introducing flavors to specific demographics.

Currently, the Coca-Cola beverage, despite the presence of strong competitors, has managed to maintain this trend by avoiding the stage of decline, using the cycle of successive relaunches to continue being one of the best-selling soft drinks.

See also Product and Lifecycle.