Introduction:
Introduction Costs are high. Sales grow slowly. There is little or no competition.
Introduction (Cont’d):
Introduction (Cont’d) Demand has to be created. Customers need encouraging to try product. The product rarely makes money.
Growth:
Growth Economies of scale cause cost reduction. Sales increase significantly. Product begins to make money.
Growth (Cont’d):
Growth (Cont’d) Public becomes more aware of product. C ompetitors introduce similar products. Higher competition leads to lower prices.
Maturity:
Maturity Product volume increases, costs are lowered. Sales peak and market saturation reached. Competitors continue to enter the market.
Maturity (Cont’d):
Maturity (Cont’d) Prices drop due to competing products. Brand differentiation and feature diversification emphasized. Industrial profits go down.
Decline:
Decline Costs become less than optimal. Sales go down or stabilize.
Decline (Cont’d):
Decline (Cont’d) Prices and profitability decrease. Efficiency determines profit, rather than sales.