Every company that provides goods or services applies a process known as the product life cycle. This cycle comprises the main stages a product undergoes during its existence, from its conception until it is eventually discontinued. The five stages include product development, introduction, growth, maturity, and decline. For each stage of the product life cycle, market research methods are heavily utilized to determine the appropriate decisions. Knowing which stage the product is in and how to effectively market it is invaluable knowledge for the product’s success.
The first stage every product inevitably goes through after its conception is the development stage. According to DriveResearch, up to 70-80% of products fail before launch due to a lack of demand or poor market research efforts. Because of the high failure rate, this stage is by far the most research-intensive. It involves collecting a wide range of information via primary and secondary market research. Primary research involves conducting the studies oneself, while secondary research finding and utilizing existing data. Primary research used in the development stage includes observational research or focus groups to gauge demand and identify appropriate audiences. Product testing is another large part of the development phase where prototypes are developed and tested. This is followed by feedback freely discussed in a group or one-on-one setting. Secondary research can be used to find data such as market size, target markets, and competitors.
Once development is complete and the product is released to the public, it enters the introduction phase of its life cycle. During this stage, brand awareness and consumer feedback become paramount to the product’s success. An example of this is Apple’s presentations, where they discuss new and upcoming technology while gauging the audience’s reactions and initial thoughts. Product introduction research includes determining buyer personas, pricing, retailers or wholesalers, and distributing effective campaigns to the relevant channels. Knowing one’s audience is imperative, as these campaigns are executed through targeted content marketing efforts and advertisements based on various demographics, psychographics, and geographic locations. These are gathered through consumer surveys and interviews conducted before or after the product’s launch.
After a product’s sales begin to increase and a market strategy is proven successful, it can enter the growth stage. This is because over 60% of marketers measure the success of their content marketing strategy through sales, according to HubSpot. When demand is increasing, the company should focus on building brand recognition and increasing market share. To do this, companies should perform a competitive analysis to determine their prominent competitors and how to outperform them. This is done by utilizing secondary research and existing data online to determine consumer trends and preferences.
Conducting primary qualitative research, such as surveys and focus groups, determines how consumers are using the product. It also determines which distribution channels or methods to use as the product’s audience expands. Businesses in the growth stage including most technology companies like Apple, constantly compete with other industry giants such as Google and Samsung for market share.
Once a product reaches its peak demand and returns begin to stabilize, this is referred to as its maturity stage. The product has received enough exposure that a company can begin to rely less on advertising and growing its audience, and it can focus more on maintaining sales. Some household companies face a long-term and profitable maturity stage, such as Kellogg’s, which holds the majority share in the cereal industry. Kellogg’s ad spending in 2019 was nearly half of its peak in the late 2000s and early 2010s, according to Statista.
The maturity stage is used to innovate in a stagnant market, such as creating new variations or improvements of existing products based on the results of market research surveys. Sometimes untapped audiences are reached with the addition of these newer variations. They can be tested in focus groups or interviews, much like in the product development phase, and can then be advertised through distribution channels.
Almost every product faces some sort of decline phase in sales due to market saturation, consumer trends, or obsolescence. An example of decline is Blockbuster’s bankruptcy in 2010. Blockbuster became obsolete due to outdated business practices when compared to newer competitors such as Netflix. However, a decline does not always mean the end of a company or product, and can sometimes only be temporary. Focus group product testing is sometimes necessary to innovate and attract new audiences, much like the maturity stage. Additionally, companies can collect feedback via surveys or other outreach methods to create long-term and profitable relationships with more dedicated audiences.
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