Industry Maturity Stages
Product Life Cycle
Summary of Industry Maturity Stages. Abstract
Fox, Wasson, Hofer, Anderson & Zeithaml, Hill & Jones
The Product Life Cycle model can help analyzing Product and Industry Maturity Stages.
Any Business is constantly seeking ways to grow future cash flows by
maximizing revenue from the sale of products and services. Cash Flow
allows a company to maintain viability, invest in new product
development and improve its workforce; all in an effort to acquire
additional market share and become a leader in its respective industry.
Also, product life cycles are becoming shorter and shorter and many
products in mature industries are revitalized by product differentiation
and market segmentation. Organizations increasingly reassess product
life cycle costs and revenues as the time available to sell a product
and recover the investment in it shrinks.
In the Introduction stage, the
product is introduced to the market through a focused and intense
marketing effort designed to establish a clear identity and promote
maximum awareness. Many trial or impulse purchases will occur at this
stage. Next, consumer interest will bring about the Growth stage,
distinguished by increasing sales and the emergence of competitors. The
Growth stage is also characterized by sustaining marketing activities on
the vendor's side, with customers engaged in repeat purchase behavior
patterns. Arrival of the product's Maturity stage is evident when
competitors begin to leave the market, sales velocity is dramatically
reduced, and sales volume reaches a steady state. At this point in time,
mostly loyal customers purchase the product. Continuous decline in sales
signals entry into the Decline stage. The lingering effects of
competition, unfavorable economic conditions, new fashion trends, etc,
often explain the decline in sales.
Several variations of the industry
life cycle model have been developed to address the development of the
product, market, and/ or
industry. Although the models are similar, they differ as to the number
and names of the stages. Here are some major ones:
1973: Fox: precommercialization -
introduction - growth - maturity - decline.
1984: Anderson & Zeithaml: introduction - growth - maturity - decline
1998: Hill and Jones: embryonic - growth - shakeout - maturity - decline
Compare with Product Life Cycle: Bass Diffusion model | ADL Matrix | BCG Matrix | Positioning | GE Matrix | Innovation Adoption Curve | STRATPORT | Profit Pools | Marketing Mix | Four Trajectories of Industry Change | Relative Value of Growth
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