Page 8 - Portfolio Analysis
P. 8
PRODUCT LIFE CYCLE - PLC
Today it is readily accepted that products and technologies have a
recognisable life cycle. They are born, they grow, they reach maturity and
then they die.
FIGURE 3
PRODUCT LIFE CYCLE
Sales and profits
Maturity
Growth
Introduction Decline
Sales
Profit
Time
Life Cycle Stages
Introduction
In the introductory or development stage there are few competitors and
few buyers. The stage is marked by slow growth in sales. Promotional
expenditures are often at their highest in this stage. However, as volume
and profit grow (or take off) competitors will be attracted into the market
especially if the innovator lacks the capacity to satisfy demand.
