Like many living things, a product has a life cycle and evolves through multiple stages.
i) Introduction
At this stage, there is a lot of research and development. Sales and profits are low. A product at this stage his highly vulnerable and funds are needed to grow properly.
ii) Growth
At this stage, sales and profits are growing. A substantial amount of promotional effort is required to sustain this stage.
iii) Maturity
Sales and profits peak at this stage. Profits may diminish because competition is getting into this game.
iv) Saturation
Decreased profitability occurs here. Competitors are starting to get into the game.
v) Decline
Market share is slowly being eroded and cost cutting will occur at this stage.
vi) Abandonment
Production ends at this stage.
When you understand that everything has a beginning and an end, you begin to have less of an attachment to your product and more to the process of grandfathering a product through the various life cycles.
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