Product Life Cycle
Product life cycle a line graph that shows the progress of your product as well as decline.
There are four stages in total. The first one is introduction. at this stage the product doesn't sell much because it is new and most people don't know about it yet. The second stage is Growth. This is when the public are starting to get to know the product and actually start to buy it. Thirdly, you have maturity. This is when the product becomes popular and everyone is purchasing it. Lastly, this when the product starts to decline because no-one is buying it and it becomes outdated.
Extension strategies are very popular and important in a business in order to maximise profit. Brands add new features and items to keep their loyal customers and to attract more. The brand would do this by adding new features, extra advertising and special promotions.
This is the Boston Matrix. This is a tool designed to tell you what you should do with your products depending on what category they are in. if it is in Dog then you should just kill it. If you are in Cash cow you should market more. If it is in problem child add new features and lastly, if it is in Star, you should invest all your money that you had.
Market Growth is pretty much what all business try to achieve as well as market share. However, a business cannot just buy it, they must win it. They do this by launching a product that can win the consumers opinion and choice. The more it grows, the more profit you will be able to make. But, it all depends on your product. At the moment, Apple have a large market Growth because they launch a new product every 6-12 months.
Market share is all depending on how popular your product is. market Share is how much of the market it is selling and how much it owns at the moment.
Product range is pretty much the same of a product however, just a couple of new features have been added. For example, Apple do this all the time with their iPhones. A prime example is between the iPhone 5 and iPhone 5s. they both have the same shape but the 5s has a better processor a new A7 software chip and a finger print lock system.
What do to with a Cash Cow?
If your product fits into the category as a cash cow, then the best thing to do is to milk it. By this I mean to drain all the money that you can out of it then when it lands into a Dog, just KILL it.
What do to with a Dog?
if you have a dog, the best thing to do would be to just kill it because you are more likely to lose money rather than making any money out of it.
What to do with a Star
If your product lands into the category of star, the best thing to do is to invest all the money that you have into it because it is very likely to be very successful.
What to do with a problem child?
If your product lands into the category of problem child, then the best thing to do is to add new features and see which way it would go. If you add new features the product with either come out very good or very bad. This is one of the big risks you must face in business and marketing.
What is wrong with the Product Life Cycle?
The problem with the product life cycle is that it is able to tell you where your product is, however, it doesn't come out with a solution. So you are able to track it but if you want to know what to do then you are stuck unless you get the position of your product from the product life cycle, then use that information to categorise it which will give you a solution.
What is the problem with the Boston Matrix?
Although the Boston Matrix is very good, there is also faults in it. One of the biggest issues is that it is based on people's opinion. SO every time someone has a look at it to evaluate it, they will have a different interpretation towards it.