Some products seem to be forever “trendy”…
…while others go off trend pretty fast, even in a matter of months. Understanding that products have life cycles just like living beings makes it easier to take better business decisions.
One of the most important things an entrepreneur needs to know about products is that they act like living creatures. No, they don’t breathe and eat and sleep, but they are born, they grow, they mature and then die. Knowing in which stage your product is makes things a lot easier.
The 2most important life cycle stages
Basically, a new product is launched into the market. The introduction stage it may look like a short process, but it can take a lot of time and also cost huge amounts of money. Launching is all about presenting the product in the best light and reaching as many potential customers as possible. Well, that means plenty of cash for advertising and marketing. Well-planned campaigns can bring huge success and turn products into stars.
From my point of view, this is the most critical stage. Everything a company worked for, all the money spent on product’s development and on the launching of the product should pay off into a successful growth. But it’s not easy. Many unforeseen problems can occur and jeopardize a product’s growth. The best-case scenario happens when a product is so requested that a company can’t keep up with the requests and a break, in the supply chain, occurs. The worse case scenario is the one in which the company has too many supplies and too little demand.
The Investment Stages
Consider these two stages, both introduction and growth, as the “investment stages” because they require time and money. The next two, maturity and decline, are “the payment check” not only because they cash in the profit, but because it’s the perfect time to analyze the results of probably years of hard work.
If you’re running a startup or think about starting one, here are two questions I would like you to ask yourself:
- In which stage is the type of product that I want to launch? Is it a wise decision to launch it now? For example: laptops are far from growth stages, they are somewhere between maturity and decline. If you want to launch a new laptop, it must be some super awesome sparkling laptop to compete with the ones from the market. Can you produce that laptop?
- Do I have enough money for both the development of the product and for advertising? Your product can be the best ever seen on a specific market, but if you don’t have a budget for advertising, only your friends and some neighbors will hear of it.