 Introduction
You may already be thinking that the title sounds a little ambitious, but the article will make the point that sales growth is not about luck: it is about making the most out of your product or service at the right time to reach your maximum sales targets.
When businesses introduce new products and services, it is important that they identify the different stages of their 'life cycle'. All products and services go through this period and are known as the 'Product Life Cycle' (PLC). There are different stages in the PLC in which specific marketing has to be taken to gain the highest benefit from each stage. This will vary from promotions, pricing strategies, advertising, and so on.
By failing to recognize when your product/service has moved into a new stage of the PLC, it can result in marketing actions being made too soon or too late. Consequently, this can cause business failure for those small businesses where their future depends on the success of the current product/service.
This article will identify the different stages of the PLC with an added view to the profit levels that you can expect to receive at each stage
The Product Life Cycle
The PLC is a model that illustrates the different stages (six in total) that a product or service will pass through. Each stage has its own attributes and will vary in length (time) with different products and services. The time that it takes for your product/service to move through the PLC will largely be determined by how effective your marketing plan is. It should therefore be stressed that the PLC is a marketing tool to assist you when compiling a marketing plan. Below is a diagram of the Product Life Cycle:
Stage 1: Development As soon as you put pen to paper, this is where the PLC of the product/service begins. This is the time where you will design and develop your product/service with all the direct costs that may be incurred such as wages, materials for prototypes, research, etc. During development, a product/service may never move onto the next stage because you may decide that the risk is too high to launch the product/service. It is important that you recognize any risk during this time as small businesses will be affected if the product/service does not prove to be successful once introduced: the costs of development and introduction may never be recovered where larger companies can usually compensate for unsuccessful products. Within this stage, the product has not yet been introduced to the market and consequently there are no sales. The expenditure of development has also created a loss. Stage 2: Introduction It is arguable that this stage can influence the length of the PLC and so the product/service should be introduced in the market as effectively as possible. This is the time when the product/service is new in the market and a high degree of marketing will be needed such as promotions and advertising to increase commercial awareness. Sales will be slow during the introduction stage and so you should not become impatient and spend more money than necessary to try to increase the speed of sales: it will take time for people to use and trust your product/service. As you begin to make sales, the money used for developing and introducing the product/service may not be fully recovered (i.e. break-even) until late in the introduction stage. Once you begin to make profit, you may decide to re-invest the money back into promoting the product/service in an attempt to stimulate future sales (and profit).
Article Index 1 Guarantee Your Sales Growth
2 The Product Life Cycle
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