The digital landscape of products is always changing, so when we refer to the lifecycle of a digital product we are referring to the stage of it’s growth, maturity and decline.
The growth and decline of a product is the beginning and end of the product lifecycle for a non-digital product. But for digital products the lifecycle is circular, maintenance and user testing can restore viability and in some cases completely reshape the market in which our product exists in. Companies may need to consider that the end goal for a product – the ‘decline’ – may be required, as it may fit in with a sale or season, a predefined amount of time, that we want the product to exist for.
It makes sense to keep making money from a product and even though we might have a particular timeframe that is most ‘optimal’ we can still update, change and review to add value to existing products.
Introduction Stage
In this stage the product is distributed and made available for sale.
Marketers work hard to create enough demand for the new product in the market.
Customers will need to be encouraged to try the product.
Aim to build market share – a company might try a low penetrating price strategy.
Revenue generation might be very low and mainly covers research and development and that means no profit at this stage.
Growth Stage
The growth stage provides a company with strong growth in terms of sales volume and profit earned.
Companies aim to achieve economies of scale that leads to cost reduction.
This can help the company to invest in in more resources in terms of advertising and promotion of the product.
Promotion can benefit both public awareness and profitability increases.
Mostly prices remain the same and the company approaches new distribution channels to fulfil increasing demand.
Maturity Stage
When the sales of a product or service slows, the maturity stage is reached.
This is the longest stage of the lifecycle.
This can be a challenging time for manufacturers and businesses.
Need to start thinking about how to enhance product features to keep customers happy.
Decline
Last of the lifecycle stage.
The product is getting older and starting to shrink.
One of the reasons may be that the market is saturated due to competitor’s products; with new features and decreased need and want.
One option is rejuvenating the product by adding new features to attract more customers.
If possible, harvest the product and target the loyal customers.