home
Developmental psychology
Planning of product life cycle processes.

Planning of product life cycle processes.

11.10.2019

The product life cycle includes all processes performed from the moment the consumer needs for a particular product are identified until those needs are met.

Product life cycle stages

Production stage. At the stage of production, the technological process is refined in order to achieve the planned product requirements. After which serial production of products is possible.

Product production stage. Production of products includes the production of intermediate products, packaging of products and packaging. Compliance requirements must be met, which include identification, handling, storage and security.

Quality control stage. Quality and quantity control is carried out at all stages of production. Both the parameters of technological processes and the parameters of the quality and safety of manufactured products are controlled. Parameters of technological processes are indicated in technological instructions, all standards of quality and safety indicators are regulated in Specifications for each item of finished product. As for the net weight of packaged products, here it is necessary to focus on the requirements of GOST 8.579-2002 “State system for ensuring the uniformity of measurements. Requirements for the quantity of packaged goods in packages of any type during their production, packaging, sale and import.” The consumer must receive the volume or quantity of the product stated on the package! And for dosage forms of biologically active food additives, the weight parameter will be critical, since for each unit of dosage form (capsule or tablet) the consumption rate of active substances is calculated based on the recommended ones. To substantiate the composition of specialized food products, MR 2.3.1.2432-08 “Norms of physiological needs for energy and nutrients for various groups of the population of the Russian Federation is used. Guidelines".

Shipment of finished products. At this stage, the Customer receives products for sale. Finished products are subject to shipment to the Customer only after receiving test results confirming compliance with established requirements.

Product sales stage. In the conditions of contract manufacturing, the implementation stage is carried out by the Customer or with the help of dealer organizations on the basis of concluded contracts.

Product use stage. After-sales service processes are not applied to cosmetic products and food supplements. But during use, if the consumer identifies any inconsistencies regarding the quality and safety of the purchased product during the expiration date indicated on the packaging, the consumer has the right to file a claim with the manufacturer. In turn, the manufacturer is obliged to consider all claims made and identify the causes of identified inconsistencies, which may entail the need to make changes to the product life cycle processes.

It should be noted that properly planned processes that make up the product life cycle lead to the release of high-quality and safe products, which adds value to both the manufacturing company and the distributor and increases consumer demand for the products. And this, in turn, allows the manufacturer to take a strong position in the market.

The period from the introduction of a product to the market until its discontinuation. The life cycle length is not the same for different products.

However, the general modern trend is to reduce its continuation, acceleration, due to manufactured products.

The life cycle of goods can be divided into several main stages:

Stage of bringing a product to market

It is characterized by a very high degree of uncertainty of results, since it is difficult to determine in advance whether a new product will be successful.
The company's marketing efforts are aimed at informing consumers and intermediaries about the new product.
At this stage, the enterprise has high marketing costs, production costs are also high due to the low volume of output.
There is no profit at this stage.

Growth stage

Characterized by rapid development of sales.
If the product turns out to be successful and moves into the growth phase, the manufacturer begins to reduce the cost of producing the product due to an increase in output volume and sales price.
Prices may be lowered, which may allow the enterprise to gradually cover the entire potential market.
Marketing costs continue to be high.
At this stage, the company usually has competitors.

Maturity stage

The volume of demand reaches its maximum.
The market at this stage is highly segmented, enterprises are trying to satisfy all possible needs. It is at this stage that the likelihood of repeated technological improvement or modification of the product is most effective.
The main task of the enterprise at this stage is to maintain and, if possible, expand its market share and achieve a sustainable advantage over direct competitors.

Decline stage

Manifests itself in a decrease in demand.
As sales and profit prospects decline, some firms reduce their investments and exit the market. Other firms, on the contrary, try to specialize in the residual market if it is of economic interest or the decline occurs gradually. However, with the exception of occasionally observed cases of market revival, the cessation of production of a technologically obsolete product becomes inevitable.

Product life cycle

Each product lives on the market for a certain time. Sooner or later it is replaced by another, more perfect one. In this regard, the concept of a product life cycle is introduced (Fig. 9.3).

Product life cycle- the time from the initial appearance of a product on the market until the cessation of its sale in this market. (This should not be confused with the production life cycle, which includes R&D, development in production, production itself, operation and discontinuation.) The life cycle is described by changes in sales and profit indicators over time and consists of the following stages: start of sales (market introduction) , growth, maturity (saturation) and decline.

Rice. 9.3. Product life cycle

Market introduction stage is characterized by a slight increase in sales volume and may be unprofitable due to high initial marketing costs, small volumes of product output and the lack of development of its production.

Sales growth stage characterized by rapid growth in sales volume driven by consumer acceptance of the product, profitability increases, the relative share of marketing costs typically falls, prices are constant or fall slightly.

On maturity stages sales growth slows down and even begins to fall, since the product has already been purchased by the majority of potential consumers, competition intensifies, marketing costs usually increase, prices may decrease, profits stabilize or decrease. When upgrading the product and/or market segments, it is possible to extend this stage.

Recession manifests itself in a sharp decline in sales and profits. Product upgrades, price reductions, and increased marketing costs can only prolong this stage. It is necessary to note that the maximum profit, as a rule, in comparison with the maximum sales volume, shifts towards the initial stages of the life cycle. This is due to increased costs of maintaining sales at later stages of the product life cycle.

The concept of life cycle is applicable to a class of product (telephone), type of product (cordless telephone), to a specific brand of product (radio telephone of a specific company). Of greatest practical interest is the study of the life cycle of a specific brand of product. This concept is also applicable to such phenomena as style (clothing, furniture, art, etc.) and fashion. Different marketing strategies are used at different stages of the life cycle.

Life cycle curve shape, as a rule, remains more or less the same for most products. This means that once a product appears on the market, if consumers like it, then its sales volume grows and then falls. However, the duration and intensity of the transition from one stage to another vary greatly depending on the specifics of the product and market. The transition from stage to stage occurs quite smoothly, so the marketing function must closely monitor changes in sales and profits in order to grasp the boundaries of the stages and make changes to the marketing program accordingly.

It is especially important to catch the stage of saturation, and even more so - the decline, since keeping an exhausted product on the market is unprofitable, and in terms of prestige, it is simply harmful. Obviously, you also need to choose the right moment to enter the market with some new product.

If the demand for such a product is already falling, it is hardly worth starting commercial activities on the market. Obviously, when it is determined that a product is at the stage of maturity or saturation, then efforts must be made to develop a new product to replace the product that has exhausted itself.

Other options for life cycle curves are also possible (Fig. 9.4).

Despite the popularity of product life cycle theory, there is no evidence that most products go through a typical 4-phase cycle and have standard life cycle curves. There is also no evidence that the turning points of the various phases of the life cycle are to any degree predictable. In addition, depending on the level of aggregation at which a product is considered, different types of life cycle curves can be considered.

Rice. 9.4. Various life cycle curve options

The first thing to remember is that market research does not start with the product, but with the needs of consumers. For example, consumers have a need for transport (Figure 9.5). Such needs may remain constant, grow from century to century, and may never reach a decline phase.

Rice. 9.5. Life cycles of needs, technologies, products

The need for transport is concretized into the demand for certain technological methods of satisfying it (from primitive vehicles, from horse-drawn carriages to cars and other modern vehicles).

Life cycle of technological methods, although shorter than needs, can be extremely long.

Technological methods can be implemented using various specific technical and technological solutions. For example, cars can use steam, piston, turbine, and electric engines, which also have their own life cycle. Radio transmitting devices consistently used vacuum tubes, semiconductors, and integrated circuits. Hidden under each such curve is a series of life cycle curves for individual technical and technological innovations. These life cycle curves can be very short and they certainly tend to shorten.

The nature of the life cycle curve is often the result of management actions and is not due to external causes. Many managers believe that every product inevitably follows its own life cycle curve. When sales volume stabilizes, instead of updating the technology and looking for new market opportunities, managers classify the product as a “cash cow” and begin to look for other business.

In addition, the core concept of marketing is to focus on consumer needs rather than focusing on selling products. The life cycle concept has a product rather than a marketing orientation. The product of a particular organization will “die” if needs change, if a competitor makes a better offer, if new technologies allow us to offer something new to consumers. Therefore, it is better to focus your efforts on identifying the causes of change rather than studying their consequences using a life cycle curve.

Identifying the reasons for changes will allow us to anticipate future changes and develop a product policy that is maximally adapted to them.

When developing and implementing product policy, it is necessary to take into account that the same product in different markets may be at different stages of its life cycle.

In practice, most companies sell multiple products in different markets. In this case, the concept " product portfolio", which refers to the totality of products produced by the company. The product portfolio must be balanced and include products at different stages of the life cycle, which ensures the continuity of the organization's production and sales activities, constant profit generation, and reduces the risk of not receiving the expected amount of profit from the sale of products, at the initial stages of their life cycle.

Product life cycle (PLC)- time of existence of the product on the market.

The best known and most criticized marketing concept is the Product Life Cycle (PLC) concept. Its main idea is that any policy regarding a product on the market can be modified under the influence of existing market conditions, and the manufacturer is not a passive observer of this process, but has the ability to manage it.

The concept of life cycle is based on the fact that any product is sooner or later forced out of the market by another, more advanced or cheaper product.

There may be long-lived goods, but there are no eternal goods.

The life cycle is characterized by two necessary conditions:

· the duration of each stage has certain deadlines;

· the sequence of each stage is also constant: one stage follows another invariably and irreversibly.

Graphically, the life cycle can be represented as a period of time T(Figure 3). The graph expresses the volume of sales of goods on the market in physical (in the number of units sold) or in value (in the form of the amount of money received for the sale) expression. A number of characteristic sections (t 1 -t 6) can be identified on this curve.

Stage of development and entry into the market

Main characteristics - significant production and research costs.

The procedure for bringing a product to market takes time, and sales during this period usually grows slowly .

Example: Well-known products such as instant coffee, frozen orange juice, and creamer powder had to wait many years before they entered a period of rapid growth.

Slow growth can be explained by the following circumstances:

§ delays in expanding production capacity;

§ technical problems;

§ delays in bringing goods to consumers;

§ clients’ reluctance to give up their usual patterns of behavior.

The company suffers losses due to insignificant sales and high costs of organizing the distribution of goods and stimulating their sales. Promotional spending reaches its highest level at this time “due to the need for concentrated efforts to promote the new product.”

There are few manufacturers at this stage, and they release only basic variants of the product, since the market is not yet ready to accept its modifications.

Prices are usually higher at this stage.

If the demand for a given group of goods is stable, then the implementation phase may be practically absent. The product is either not sold at all, or, from the first sales, it immediately replaces a product with high demand ( biotechnology products, video discs and other fundamentally new types of products).

The modern world is characterized by a noticeable reduction in the interval between the discovery of a product and its mass use in production. An important aspect of any product strategy is the dissemination of information about the benefits that they will receive from using this product. Experiments have shown that demand begins to adapt to a new product if the first 2-5% of consumers have adapted to it.

Growth stage

If the new product satisfies the interests of the market, sales begin to grow significantly.

The product is recognized by customers and rapid increase in demand on him.

The product encounters its competitors for the first time, and this in turn creates greater choice for the consumer. Growing number of competitors leads to a sharp increase in sales from factories in order to increase distribution channels for goods.

Prices remain at the same level or slightly are decreasing as demand grows. Firms' sales promotion spending increases slightly to counteract competitors and continue to educate customers about the product.

Profits are growing, since sales promotion costs fall on a larger volume of sales while simultaneously reducing production costs.

In order to maximize the period of rapid market growth, a company can use several strategic approaches:

ü improve the quality of a new product, give it additional properties, release new models;

ü penetrate new market segments;

ü use new distribution channels;

ü reduce prices in a timely manner to attract additional consumers.

The main pricing strategies at this stage include:

“reward” or “cream skimming” strategywhen the price is set above competitors' prices, emphasizing the exceptional quality of the products. In this case, the focus is on a less price-sensitive group of consumers; the manufacturer works with individual market segments;

parity price strategywhen there is an overt or secret conspiracy with competitors or when there is an orientation towards the leader in setting the price. In this case, the focus is on the most typical mass buyer, i.e. the company works with the entire market;

market penetration strategy due to low price. Manufacturers of innovative goods rarely use it, since by reducing the price for the most sensitive group of consumers, they thereby reduce the effect of the “price-quality” relationship, which is dangerous for the reputation of the product.

At this time, the market is expanding as a result of changes in the lifestyle of previously unreached potential consumers and the geographical expansion of the market. It is at this stage that a certain general market price appears, towards which producers gravitate to a greater or lesser extent. Such a variety of pricing strategies allows the company, in the presence of a large number of competitors and a decrease in market share, not to reduce sales volume.

Product maturity stage

At some point, the rate of sales growth will begin to slow down - the maturity stage begins.

Slowdown in sales growth means that many manufacturers are accumulating inventories of unsold goods. This leads to increased competition . Competitors are increasingly resorting to selling at reduced prices. Advertising is growing and the number of preferential deals is increasing. R&D spending is increasing to create improved product variants. All this means decline in profits .

A very important issue is the ability of firms to extend the maturity stage to ensure the life of their product. A company needs to protect its product; it can:

ü modify the market - search for new markets and new market segments, repositioning the product for a larger or rapidly growing market segment;

ü modify a product - change the characteristics of a product (quality level, properties or appearance) in order to attract new users and intensify consumption.

Strategy quality improvement– improving the functional characteristics of the product, such as durability, reliability, speed, taste.

Strategy improving properties– giving the product new properties that make it more versatile, safer and more convenient.

Strategy improvement of external design– increasing the attractiveness of the product.

ü modify the marketing mix:

v reduce the price;

v active methods of sales promotion (discounts on prices, distribution of souvenirs, holding competitions);

v new or improved types of services.

For "saturation" phase It is typical for sales growth to cease with some increase in profitability if a significant reduction in production costs is achieved.

Falling stage

The stage occurs when the manufacturer experiences sustainable decrease in demand, sales volume, profit . The consumer loses interest in the product. The decline in sales is due to a number of reasons (advances in technology, changing consumer tastes, increased competition).

The company's management has three options for activities at this stage:

ü continue to produce goods - in the hope that competitors will leave a particular field of activity;

Example: The Procter and Gamble corporation at one time did not, like others, abandon the production of such a decrepit product as liquid soap, continued to produce it and received considerable profits.

ü “reap the benefits” - reduce any costs (materials and technical supplies, R&D, advertising, sales staff, etc.) in the hope that sales will remain at a fairly decent level for some time;

ü stop production of products.

In fact, depending on the specifics of individual types of goods and the characteristics of demand for them, there are various types of life cycles, which differ significantly both in duration and form of manifestation of individual phases (Figure 4).

The transition from one phase of the cycle to another usually occurs smoothly, without jumps. Because of this, the marketing service must closely monitor the dynamics of sales and profits in order to grasp the boundaries of the phases and, accordingly, make changes to the marketing program, redistribute marketing efforts, adjust the structure of the marketing mix, etc. It is especially important to catch the stage of saturation and even more so of decline, since keeping a “sick product” on the market is very unprofitable.

The product life cycle (PLC) is understood as a set of interconnected processes of changing the state of a product during the period of its creation and use, ranging from marketing and market research to technical assistance in operation and disposal.

Typical stages of the “life cycle” of industrial products can be schematically represented in the form of a so-called “quality loop” (Fig. 2):

Fig.2. Product life cycle diagram.

1 – marketing, search and market research;

2 – design and development of technological requirements;

3 – logistics;

4 – preparation and development of production processes;

5 – production of products;

6 – control, testing and inspections;

7 – packaging and storage;

8 – sales and distribution of products;

9 – installation and operation;

10 – technical assistance during maintenance;

11 – disposal after use of the product.

The name “quality loop” implies the setting and implementation of quality management tasks at each stage of the life cycle.

Understanding that a process can be represented as a sequence of activities helps management in identifying process inputs. Once the inputs have been identified, the required activities, activities and required resources for the process can be determined to achieve the desired outputs.

A document defining the quality management system processes (including life cycle processes) and resources to be applied to a specific product, project or contract can be considered as quality plan.

Continuous improvement of the organization's processes will increase the effectiveness and efficiency of the quality management system and improve the organization's performance. Annex B of GOST R ISO 9004-2001 describes a “Continuous Improvement Process” that can be used to assist in identifying the actions required to continually improve the effectiveness and efficiency of processes.

In general, this section of the quality management system should include:

1. Planning of life cycle processes;

2. processes related to consumers: requirements established by consumers; requirements of regulatory documents; any additional requirements specified by the organization;

3. product design and development; Design inputs should include:

a) functional and operational requirements;

b) requirements of regulatory and legislative documents;

c) where possible, information taken from previous

similar processes;

Corresponding requirements are also being developed for product output data.

4. procurement. The organization shall evaluate and select suppliers based on their ability to provide products in accordance with the organization's requirements. Criteria for selection, evaluation and re-evaluation should be developed.

5. production and service.

The organization must plan and carry out production under controlled conditions, which means:

a) availability of information describing the characteristics of the product;

b) availability of appropriate work instructions;

c) use of suitable equipment;

d) availability and use of control measuring instruments;

e) monitoring and measurements.

The organization must have processes in place to ensure that monitoring and measurement can and do occur as required. Where necessary, measuring equipment should be:

a) adjusted;

b) calibrated;

c) protected from adjustments that would invalidate the measurement results;

d) protected from damage and deterioration during handling, maintenance and storage.

If computer programs are used for monitoring and measurements, their suitability for use must be confirmed before use.

Each product lives on the market for a certain time. Sooner or later it is replaced by another, more perfect one. In this regard, the concept of a product life cycle is introduced (Fig. 46).

Life cycle of a product (product)- this is a set of processes performed from the moment the needs of society for a certain product are identified until these needs are met and the product is disposed of.

The product life cycle (PLC) includes the period from the emergence of the need to create a product until its liquidation due to the exhaustion of consumer properties.

Rice. 46. Product life cycle

§ Characterized by a very high degree of uncertainty of results, since it is difficult to determine in advance whether a new product will be successful.

§ The marketing efforts of the enterprise are aimed at informing consumers and intermediaries about the new product.

§ At this stage, the enterprise has high marketing costs, production costs are also high due to the low volume of output.

§ There is no profit at this stage.

§ Characterized by rapid sales development.

§ If the product turns out to be successful and moves into the growth phase, the manufacturer begins to reduce the cost of producing the product due to an increase in output volume and sales price.

§ Prices may be lowered, which may allow the company to gradually cover the entire potential market.

§ Marketing costs continue to be high.

§ At this stage, the enterprise, as a rule, has competitors.

§ Volume demand reaches its maximum.

§ The market at this stage is highly segmented, enterprises are trying to satisfy all possible needs. It is at this stage that the likelihood of repeated technological improvement or modification of the product is most effective.

§ The main task of the enterprise at this stage is to maintain and, if possible, expand its market share and achieve a sustainable advantage over direct competitors.

§ Manifests itself in a decrease in demand.

§ As sales and profit prospects decline, some firms reduce their investments and exit the market. Other firms, on the contrary, try to specialize in the residual market if it is of economic interest or the decline occurs gradually. However, with the exception of occasionally observed cases of market revival, the cessation of production of a technologically obsolete product becomes inevitable.

Other options for life cycle curves are also possible (Fig. 9.4).

Rice. 47. Various life cycle curve options

The first thing to remember is that market research does not start with the product, but with the needs of consumers. For example, consumers have a need for transport (Fig. 48). Such needs may remain constant, grow from century to century, and may never reach a decline phase.

Rice. 48. Life cycles of needs, technologies, products

The need for transport is concretized into the demand for certain technological methods of satisfying it (from primitive vehicles, from horse-drawn carriages to cars and other modern vehicles).

The life cycle of technological methods, although shorter than the needs, can be extremely long.

Identifying the reasons for changes will allow us to anticipate future changes and develop a product policy that is maximally adapted to them.

When developing and implementing product policy, it is necessary to take into account that the same product in different markets may be at different stages of its life cycle.

Automated control systems for life cycle centers.

Taking into account all stages of life cycle significantly complicates the task of designing and manufacturing products. However, the possibility of solving it is achieved by using automated life cycle control systems.

Design automation is carried out by computer-aided design systems. In the CAD systems of mechanical engineering industries, it is customary to distinguish systems functional, design And technological design.

The first of them are called calculation and engineering analysis systems or CAE (Computer Aided Engineering) systems.

Design systems are called CAD (Computer Aided Design) systems.

The design of technological processes is part of the technological preparation of production and is carried out in CAM (Computer Aided Manufacturing) systems.

To solve the problems of joint functioning of CAD components for various purposes, coordination of the work of CAE/CAD/CAM systems, management of design data and design, systems called PDM (Product Data Management) design data management systems are being developed. PDM systems are either included in the modules of a specific CAD system, or have an independent meaning and can work in conjunction with different CAD systems.

At most stages of the life cycle, from identifying suppliers of raw materials and components to selling products, the services of a supply chain management system (SCM) are required. The supply chain is usually defined as a set of stages of increasing the added value of products as they move from supplier companies to consumer companies. Supply chain management involves promoting the flow of materials at minimal cost.

Coordination of the work of many partner enterprises using Intrenet technologies is entrusted to E-commerce systems, called data management systems in the integrated information space CPC (Collaborative Product Commerce).

Information support for the production stage is provided by automated enterprise management systems (EMS) and automated process control systems (APS).

Automatic control systems include enterprise planning and management systems ERP (Enterprise Resource Planning), production planning and material requirements MRP-2 (Manufacturing Requirement Planning) and the SCM systems mentioned above. The most developed ERP systems perform various business functions related to production planning, purchasing, product sales, analysis of marketing prospects, financial management, personnel management, warehousing, fixed assets accounting, etc. MRP-2 systems are focused mainly on business functions directly related to production. In some cases, SCM and MRP-2 systems are included as subsystems in ERP; recently, they are more often considered as independent systems.

An intermediate position between automated control systems and automated process control systems is occupied by the production executive system MES (Manufacturing Execution Systems), designed to solve operational problems of design, production and marketing management.

The process control system includes a SCADA (Supervisory Control and Data Acquisition) system, which performs dispatch functions (collecting and processing data on the state of equipment and technological processes) and helps develop software for embedded equipment. For direct program control of technological equipment, CNC (Computer Numerical Control) systems are used based on controllers (specialized computers, called industrial ones), which are built into technological equipment with numerical control (CNC).

At the stage of product sales, the functions of managing relationships with customers and buyers are performed, the market situation is analyzed, and the prospects for demand for planned products are determined. These functions are assigned to the CRM system.

The functions of training maintenance personnel are assigned to interactive electronic technical manuals IETM (Interactive Electronic Technical Manuals); with their help, diagnostic operations are performed, searching for failed components, ordering additional spare parts and some other operations during the operation of systems.

Data management in the information space, common for various automated systems, is assigned to a product life cycle management system that implements PLM (Product Lifecycle Management) technologies. PLM technologies combine methods and means of information support for products throughout all stages of the product life cycle. A characteristic feature of PLM is ensuring the interaction of both automation tools from different manufacturers and various automated systems of many enterprises, that is, PLM technologies (including CPC technologies) are the basis that integrates the information space in which CAD, ERP, PDM, SCM, CRM and others operate automated systems of many enterprises.

Related information.

However, the general modern trend is to reduce its continuation, acceleration, due to manufactured products.

The life cycle of goods can be divided into several main stages:

Stage of bringing a product to market

It is characterized by a very high degree of uncertainty of results, since it is difficult to determine in advance whether a new product will be successful.
The marketing efforts of the enterprise are aimed at informing consumers and intermediaries about.
At this stage, the enterprise has high costs for, and are also high due to the low volume of output.
at this stage no.

Growth stage

Characterized by rapid development of sales.
If the product turns out to be successful and moves into the growth phase, the manufacturer begins to decline in goods due to an increase in production volume and sales price.
Prices may be lowered, which may allow the enterprise to gradually cover the entire potential market.
Marketing costs continue to be high.
At this stage, the company usually has competitors.

Maturity stage

The volume of demand reaches its maximum.
The market at this stage is highly segmented, enterprises are trying to satisfy all possible needs. It is at this stage that the likelihood of repeated technological improvement or modification of the product is most effective.
The main task of the enterprise at this stage is to maintain and, if possible, expand its market share and achieve sustainability over direct competitors.

Decline stage

Manifests itself in a decrease in demand.
As sales and profit prospects decline, some firms reduce their investments and exit the market. Other firms, on the contrary, try to specialize in the residual market if it is of economic interest or the decline occurs gradually. However, with the exception of occasionally observed cases of market revival, the cessation of production of a technologically obsolete product becomes inevitable.

Product life cycle

Each product lives on the market for a certain time. Sooner or later it is replaced by another, more perfect one. In this regard, the concept of a product life cycle is introduced (Fig. 9.3).

Product life cycle— the time from the initial appearance of a product on the market until the cessation of its sale in this market. (This should not be confused with the production life cycle, which includes R&D, development in production, production itself, operation and discontinuation.) The life cycle is described by changes in sales and profit indicators over time and consists of the following stages: start of sales (market introduction) , growth, maturity (saturation) and decline.

Rice. 9.3. Product life cycle

It is especially important to catch the stage of saturation, and even more so - recession, since keeping a product that has exhausted itself on the market is unprofitable, and in terms of prestige, it is simply harmful. Obviously, you also need to choose the right moment to enter the market with some new product.

If a similar product is already falling, it is hardly worth starting commercial activities on the market. Obviously, when it is determined that a product is at the stage of maturity or saturation, then efforts must be made to develop a new product to replace the product that has exhausted itself.

Other options for life cycle curves are also possible (Fig. 9.4).

Rice. 9.4. Various life cycle curve options

Rice. 9.5. Life cycles of needs, technologies, products

The need for transport is concretized into the demand for certain technological methods of satisfying it (from primitive vehicles, from horse-drawn carriages to cars and other modern vehicles).

The life cycle of technological methods, although shorter than the needs, can be extremely long.

In addition, the main thing is to focus on consumer needs, rather than focusing on selling products. The life cycle concept has a product rather than a marketing orientation. The product of a particular organization will “die” if needs change, if a competitor makes a better offer, if new technologies allow us to offer something new to consumers. Therefore, it is better to focus your efforts on identifying the causes of change rather than studying their consequences using a life cycle curve.

Identifying the reasons for changes will allow us to anticipate future changes and develop a product policy that is maximally adapted to them.

When developing and implementing it, it is necessary to take into account that the same product in different markets may be at different stages of its life cycle.