Does it ever feel like your sales are slowly declining? Or that the tremendous growth you once had has tapered off? You’re likely feeling the effects of the standard product life cycle. Understanding the life cycle and knowing how to combat it is an essential need in keeping your business afloat.
The product life cycle can be applied to almost all non-essential goods and services within a specific market or even applied to a business as a whole. The model depicts the relative sales over time as a new product enters the market. In a quick overview, the model starts off with the introduction of the product, where sales are low and only see a small increase over time. From introduction, a product will enter the growth stage, where it sees rapid adoption in the market and becomes widespread. From there, the product will reach maturity and market saturation, where the supply is closely meeting demand. From there, we see the sales slowly begin to drop off as the product becomes obsolete from innovation or competition. This model can take place over as little time as a year or as much time as 100 years.
Understanding how this cycle works for your product, your industry, or your business will help you form a more concrete marketing plan to keep yourself afloat. Often times when products begin to enter the declining stage, companies look to innovate to keep their existing product alive, thus costing them less money and keeping their revenues as high as possible. This is often done by simply finding a new use for a product. The greatest example of this is Arm & Hammer Baking Soda.
What was once just a simple bicarbonate soda now has a myriad of uses that has kept the product line comfortable (and profitable) for close to 200 years. The product development team at Arm & Hammer, along with their marketing team, has been able to continuously dominate the market by consistently crafting and marketing new and innovative ways to use their existing product. How many other companies do you know that can convince you to buy their product, put it in your freezer for three months, and then throw it away and replace it? Or better yet, just wash the whole box down the drain to freshen things up (and then go ahead and buy another box).
While Arm & Hammer’s approach is among the simpler solutions to keeping a product or business growing, it still highlights the need for smart and effective marketing to drive it all home. Having a smart marketing team behind you can be the deciding factor in your business growing or stagnating.