Critical Thinking On Product Life Cycle Essay

Submitted By Xinjie-YU
Words: 1741
Pages: 7
Open Document
Critical evaluation of Product life cycle

Introduction
The lifetime of a new product goes through consecutive stages from product introduction to market growth, market maturity and sales decline (Forrester, 1963). This progress is known as the product life cycle. It is related to the marketing changes and it is useful to use this model to analyze marketing mix and do strategic decision. This essay will provide a brief explanation of the PLC model and then review the development of the concept. Finally, it will critically evaluate the PLC model based on the literature including the contribution of marketing plan process and the limitation of the concept.

Brief explanation of the PLC model
This progress from introduction to decline likes the real life of a product and “life cycle” derived from this (Brockhoff, 1967). During product development period, sales of the product is zero, the company will increase investment; During the introduction period, sales is slow and usually low or negative profits at the beginning; During the growth stage, the sales growing rapidly and the profits also increased significantly; Profits will arrive the peach at maturity stage and gradually decline after apex; During decline period product sales decline significant and profits fall dramatically (Armstrong and Kotler, 2011; Baker, 2003). The classical model shows below:

Figure 1 the four stages of the product life cycle

Based on the view of Armstrong and Kotler (2011) and combine other literatures, the features of each stages of the PLC could be summarized as show below:

Figure 2 features of the four stages of the PLC

Introduction

Growth
Maturity

Decline

Product

Technology instability, lower quality, design changes frequently
Technology stabilized, product standardization
Product diversification
Elimination weak product
Market size
Small market capacity，low market share, high price
Expand market capacity, market share increased, prices decreased
The market is saturated gradually
New products appear, the market share decline
Sales
Low
Increase rapidly
Rich the peak of sales
Sales decline
Cost
High
Average cost
Low cost
Low cost
Profit
Loss
Profit increase

High profit
Profit decline
Customer
Innovators
Early users
Most customers
Maintenance person
Competitors
Seldom
Increase
A lot，began to decrease
Decrease

According to Armstrong and Kotler (2011), except the classical PLC curve, there are three special types: Style (once the style produced, it may continue for generations, according to customer interest it may show a loop recirculation trend), Fashion (listing rarely accepted at the unique stage, then the number of accepted grow slowly over the imitation stage and been widely accepted, finally slow decline) and Fad (Often fast growing and fast decline, can not meet the needs of more intense).
Figure3: Special product life cycles:

Development of the product life cycle
The origin of the product life cycle concept is not exactly clear (Garddner, 1987). According to Buzzell (1966), one of the earlier references to the similarity S-shaped curve as the PLC was that of Prescott. Muhs (1985) said that Jones actually approached the first reference labeled the PLC. As Jones (1957) said there is a life cycle behind each new product, but the definitions of the PLC not published. The PLC concept became a literature by Chester Wasson. He strongly convinces that the current stage of the market life cycle has a strong relationship with the successfulness of a marketing plan and strategic management. Many researchers are agreed with the PLC concept and one of the most influential people is Day, who comprehensively evaluates the feature of the product life cycle. As Day (1986) announced that each product has a limited life and follows an S-curve begins at entrance the market and finally as decline.

Useless and contribution to the marketing plan process
Product Life Cycle (PLC) provides a suitable marketing plan view. It divides the lifetime
Show More

Related Documents: Critical Thinking On Product Life Cycle Essay

Diabetes Education

According to Kelly (2011), three different types of critical thinking methods that can be used in designing improvements are continuous improvement cycle, six sigma DMAIC, and performance management cycle. The continuous improvement cycle, also known as the Shewhart cycle and PDCA cycle involves of four unceasing steps that management performs (Kelly, 2011). According to Kelly (2011), these create a recurrent nature…

Words 1278 - Pages 6

S Problems With Its Control And Evaluation Systems To Each Of The Stages Of Growth In The Greiner's Model

Critical Thinking Issue 1: Relate Microsoft’s problems with its control and evaluation systems to each of the stages of growth in the Greiner’s model. Organizational growth is similar to the life cycle of any living entity. The organization is birthed in an entrepreneur’s head and then goes through the growth cycles to create its own version of becoming a legitimate entity that the stakeholders find dependable, responsible, and having the ability to create value (Jones, 2010). As the organization…

Words 981 - Pages 4

Lean And Agile Comparision Essay

Management, Rasht Branch, Islamic Azad University, Rasht, Iran Abstract With the beginning 21st century manufacturing organization felt major and strongly changes about their. These changes will lead organizations to the challenges such as reduced product life cycle, minimum production cost and responding to diverse needs of customers that organizations for survival must be noted it until take minimum of loss and maximum of benefit from these changes .Factors such as technological advancement, globalization…

Words 3906 - Pages 16

Role Of Hospitality Management

those within conference and event centers. Products and services you would be responsible for to integrate sustainability into all aspects of the product development cycle – from concept and design to the manufacture, packaging, delivery and possible return of the product. Critical to the process of greening product development is the concept of examining a product’s lifecycle. A lifecycle assessment examines the “cradle to grave” aspects of a product – from the extraction of raw materials, through…

Words 1271 - Pages 6

Essay on Your subject in the curriculum

achievement (DfE, 2013). The National Curriculum acts a framework document (guideline) to education. According to Bourdillon and Storey, the school curriculum is more important than the National Curriculum since it includes all aspects of school life and organisation that affect teaching and learning, not just the content or syllabus (Bourdillon and Storey, 2002). Furthermore, the school curriculum tends to reflect upon the local community, parents, pupils and central government (Bourdillon and…

Words 1025 - Pages 5

WEEK 5 INDIVIDUAL ASSIGNMENT Essay

Diannah Thomas In the modern business world, the working environments for all different types of business organizations have seen massive amounts of change. This factor is due largely in part to situations like globalization and the constant cycles of development in information technologies. Business organizations have no choice anymore but to face and accommodate this new business environment. Change in the business environment is never as easy as it seems, and each organization will face its…

Words 1319 - Pages 6

Essay about Effects of Images

brainwashing us into thinking we need the latest and greatest. We are unaware of the impact they have on our lives. Although these images seem very appealing, they are causing many negative problems in American’s everyday lives. Advertisers have shaped our generations’ way of thinking by evoking emotion in many of the television commercials today. In Cameron Johnson’s “The Mighty Image” he claims that most Americans don’t realize the influence images have on them. “Millions of products suddenly get purchased…

Words 1777 - Pages 8

Gsl Notes Essay

level or position within an Org Capacity to motive and elicit employee commitment Effective and Forward thinking Accountant Roles in Strategic Leadership 2 External Environment – Analysing an Industry Process includes – definition of ‘Industry’, Life Cycle Stage, Evolution, how factors may change their impact on future growth & profitability, what drives customers demand, Critical Success factors & how competitors compete Gathering Data – Internet, Public Agencies & Statutory Authorities…

Words 872 - Pages 4

Essay on Ops final study guise

direction for carrying out the actual operations. Strategic operations decision comes from senior management, are focused on long-term aspects of the firm, and generally have a broad scope with a low level of detail. These types of decisions include product design, choice of location, choice of technology, and new facilities. Tactical operations decisions usually occur at middle management positions and are focused on more moderate time frames. The scope of the decision is moderate, as is the level…

Words 3629 - Pages 15

Essay on The insourcing boom

costs where it isn’t as important as other key components such as material costs, shipping costs, and development and design. I believe that insourcing can be an advantage also because when you outsource you aren’t able to see the process of the product being made. This gives room for things getting taken out or added into development. With lean management you are able to have visual control. You can see how and when everything is being done and operated. From the control of the machinery to the…

Words 1141 - Pages 5