The product lifecycle refers to the time it takes from meeting consumers to the time it leaves the market. The life span of products usually consists of four different stages. These are the processes of entry, growth, maturity and decline. Product lifecycles are used by marketing professionals to help determine advertising work, price points, product marketing methods, packaging designs, and more. All of these strategic methods of supporting a product are described as product lifecycle management. The concept known in English as product lifecycle management can also help determine when new products should be launched. So, what is product lifecycle management, what are its stages and why are they important? Let's take a closer look at all the details of the concept of product lifecycle, which is of critical value to businesses.
Product lifecycle management refers to the examination of a product as it goes through certain stages of its lifecycle. As mentioned above, these phases are periods of product development, product launch, maturity/stability and decline.
PLM contains useful information on the production and marketing of the product. Through the product lifecycle, organizations can make many important business decisions and evaluate potential business opportunities, from pricing to promotion, market expansion to cost reduction.
The fact that the life cycle of a product goes through several stages determines how the product will be marketed to consumers. To successfully bring a product to market, it may be necessary to remove old products from the market after seeing an increase in demand and product popularity. As the new product becomes established in the market, product marketing efforts decrease, and costs associated with marketing and production decrease. As the product matures in the market and goes into decline, demand decreases and the product may be removed from the market to be replaced by a newer alternative.
Managing the four phases of the product lifecycle well helps increase profitability and maximize returns. Acting in the opposite direction can cause a product to fail to meet its potential and shorten its shelf life. The four stages of the life cycle of a product are as follows:
This phase involves making advertising and marketing investments to make consumers aware of the product and its benefits and developing a market strategy in this area. Sales tend to be slow as demand is tried to be created during the market entry and development phase. The process in question can take a certain amount of time depending on the nature of the product, how new it is, how much it fits customer needs and whether there is competition in the market. Creating a new product that addresses customer needs is more likely to succeed in the market. But this also does not lead to the conclusion that the product can be a complete success. So many companies prefer to follow in the footsteps of an innovative product on the market, improve an existing product or launch their own version.
If a product successfully progresses in the process of entering the market, it means that it is ready to enter the growth phase of its life cycle. At this stage, the data should show that the increased demand for the product encourages an increase in production and that the product becomes more widely available. As a result of the steady progress of the market entry and development phase, the product goes on a sharp rise. At the same time, some competitors may enter the market with different versions of the relevant product, one-to-one copies or the like. Since other alternatives are offered to the consumer, your branding strategy at this stage is extremely important to maintain your position in the market. On the other hand, product pricing and availability also become important factors to continue increasing sales in the face of rising competition.
At the stage of maturation of the product there is now a product on the market. Thus, over time, the cost of producing and marketing the existing product decreases. When the product lifecycle reaches this stage, market saturation begins. Many users will now have purchased the product and new competitors will emerge. This also shows that branding, price and product differentiation will be important in order to maintain market share. At the stage of product maturity, retail companies become people who stock up and receive orders instead of promotion.
In the product decline phase, other companies try to imitate the related product with additional product features or lower prices. As competition continues to increase in the market, the life cycle of the product decreases. This decline can also be caused by innovations that replace existing product features. The resulting situation of market saturation means that there is no longer any profit to be made on the product. At this point, many companies begin to turn to different initiatives. Although some products survive the downward cycle, production will be on a smaller scale, and prices and profit margins may fall. But doing style and innovation studies to stimulate interest in an old product in certain situations, modernizing the product can reverse the cycle.
Effective product lifecycle management enables the company to outperform its competitors. Thus, the business is quite profitable and can have a product potential that continues as long as the consumer demands it. Studying product lifecycle activities closely and making efficient planning means that many companies, departments and employees involved in the production of the product are also involved in this cooperation.
In addition, using product lifecycle management systems can help businesses avoid the difficulty and technique of new product development. The lifecycles of products can also be managed more efficiently when the correct configurations are carried out in areas such as customer relationship management, corporate resources, supplier relations of the company. In addition, the introduction of the current product to the market within the framework of innovations is also possible to improve the current market share by mastering the life cycle processes.
On the other hand, determining at what stage of a product's life cycle is useful in terms of revealing how the product will be marketed. For example, because a new product is in the promotion phase, it requires more advertising, while a mature product may need to be differentiated. This can be achieved according to an effective PLM management process and detailed analysis results.
Good product lifecycle management has many benefits, such as getting the product to market faster, creating a better quality product, improving product safety, increasing sales opportunities, minimizing errors. It is possible to take advantage of many different business intelligence applications such as document management, design integration and process management to keep track of product management processes. The advantages of the product lifecycle to companies are as follows:
You can also take advantage of Komtaş's extensive data and analytics ecosystem to carry out effective product lifecycle planning during the product/service creation phase. You can follow the life cycles of your products by following the life cycles of your products with Komtaş's innovative business intelligence solutions.
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