What is a product lifecycle?

Predicting a product's lifecycle involves understanding a theoretical model based on time and sales rate, which typically follows a curve of initial low sales, growth, plateau, and eventual decline. This lifecycle is divided into five stages: development, introduction, growth, maturity, and decline. In the development stage, resources are allocated to research and testing, while the introduction phase involves slow sales growth and high promotional costs. The growth stage is characterized by rapid sales increase and market penetration efforts, often attracting competitors, as seen with Gatorade and Red Bull. During maturity, sales stabilize, competition intensifies, and efficient operations help maintain profitability despite falling prices. Finally, the decline phase sees sales drop due to market changes or new products, prompting companies to cut costs and focus on loyal customers until discontinuing the product. The duration of each lifecycle stage can vary significantly across different products, emphasizing the model's role in enhancing business agility rather than offering precise timelines.