January 4, 2021

Understanding the Product Life Cycle

What does a product’s life cycle look like, and how do various factors affect the way the graph looks for different products?

Understanding the Product Life Cycle

Just like the living and breathing, products including digital products like apps and websites each have a lifespan and go through a series of recognizable stages. These stages make up the product life cycle (PLC).

Depending on how well they are maintained, one product’s life cycle can show steeper curves or be longer than others, but the general shape is pretty standard across all products. The PLC generally starts with a slow rise from the ground, peaks in the third quarter, and slopes downward at the tail. 

product life cycle graph annual sales volume introduction growth maturity decline stages over time

(Image: Wikipedia)

From launch to decline, what do the stages in a product life cycle entail, and how do various factors affect the way the graph looks for every product?

Stage 1: Introduction 

The very beginning of a product’s life is its introduction to the world. 

Costs in this phase are high, as would be for any project that is just starting out. The research, development, testing, and marketing of a product will require large amounts of time and money, and high levels of energy. In simpler words, you’ll be putting out a lot more than you get in return, whether in conversion or market size.

That’s okay though, because the focus at this point shouldn’t yet be to profit or expand. 

Before all that happens, your goal is to build product awareness and accelerate customer acquisition. Make your app discoverable on the app stores, get optimized on search engines, market your services with ads, or build relationships with your customers on social media. All these are investments that will pay off in the next phase.

Stage 2: Growth

The Growth phase is where a product’s demand, return, and productivity sees steady and gradual acceleration. 

In this stage, the focus extends from customer acquisition to customer retention and customer loyalty. More effort is put into targeted marketing campaigns to gain new customers as well as build on existing relationships to maximize profits.

In other words, this is the stage where your product attempts to find and gain a position in the market. Once this is achieved, it moves on to the next (and best) stage.

Stage 3: Maturity

After securing a position in the market in the Growth stage, the Maturity stage is all about maintaining that position.

Your product is performing at its peak — you’re getting more conversions than you’re spending on production and marketing, and you’ve secured loyal customers and returning users — but that also means a fall may be imminent.

To remain in this phase, maintenance is critical. Many successful digital products like Instagram and Spotify undergo updates and redesigns to stay in the mature stage for extended periods of time. However, be mindful that changes can put your product at risk if done without tact. Read about users and change aversion here.

Stage 4: Decline

As cases may vary, the most common factors for the descent in this final phase are increased competition and a lack of maintenance. Products that fail to adapt to changing behaviors in their target market will inevitably lose to their competitors.

A tragic example for this would be Borders as they couldn’t survive the internet age and the dwindling demand for print. How do you avoid going down the same path with your digital product?

You can counteract this phenomenon by creating new uses on your platform for varied usage, or carrying out continuous marketing efforts to encourage more frequent usage. 

A good example would be the Instagram app. Their latest updates (the one that put recommended posts on your feed and a new shopping tab in place of the activity tab) have been heavily criticized, but it’s hard not to admit that Instagram has been doing a lot to create varied usage. It’s one single app for sharing photos, videos, stories, and shopping — like it or not, it’s taking over a lot of the functions we enjoy. That’s one way to stay away from the dreaded decline.

Future-Proof Your Products with Us

Snappymob is equipped with designers and engineers who understand the PLC and the importance of product testing and maintenance. 

If you’re looking for a team that is capable of bringing your app far into the future, talk to us!