From the course: Becoming a Product Manager: A Complete Guide

The four major phases of the product lifecycle

From the course: Becoming a Product Manager: A Complete Guide

Start my 1-month free trial

The four major phases of the product lifecycle

“

- Hey, what's up. So before we jump into product development it's important to understand the market stages that products and companies go through on a macro level zoomed out level. First, this is what we call the product life cycle. Once a company has started, or once they have developed a new product there are four stages that product or that company go through. The four are introduction, growth, maturity, and then decline. Products and companies progress through these stages of development and the way that you know which stage they're in is how much revenue they're making over time. Also some other things like how fast the revenue is growing and what their monthly recurring revenue is. So let's talk about each one of these four phases really quickly. The introduction phase first of all. This is when a company first introduces a product to the market. Usually the product will have little to no competition in the market. At this phase of the life cycle the business typically loses money on the item and the only people that are buying it like immediately are the early adopter types. The second phase is the growth phase. And at this point the product has been accepted by the marketplace and sales start to rise. Usually again starting from the tail end of those early adopter users. The organization may choose to create improvements to the item to stay competitive and at this point there are usually still few challengers out there in the marketplace trying to compete with them. So then we have the third phase maturity. In the maturity stage of the product life cycle sales will reach their pinnacle. The other competitors enter the market with alternative solutions at this point because it's so attractive and they start making a lot of competition in the marketplace it gets pretty crazy. The company that introduced this new product may start to find it pretty difficult to compete with everyone else in the industry. Lastly, we have the decline phase. And at this phase of the product life cycle, as merchandise and products and the company just reach its saturation point that sales begin to diminish. Remember we have all of that competition out there. Most products are phased out from the marketplace right about this time because of the drop in sales and all the competitive pressure. The marketplace sees this item and says, "Okay, this is no longer new and great "it's a little bit old, not very relevant anymore." Now it's important to know that depending on the product or the industry, this stuff might shift a little bit. It's also really important to mention that there's no definitive guide to telling where a company or product is within these phases. It's really just a way of thinking a framework so we can understand how companies and products begin and end. So we've named these four phases you've got introduction, growth, maturity, and decline. Can you think of some real life companies in each one of these phases. We're going to take a look at some of these real life examples in the next lecture.

Contents