A constant study of product life cycle is important for any marketer. A product life cycle can be studied with the help of the graph which shows the product life cycle curves. The two main important curves in the graphs are- the sales curve and the profit curve.
The most vital feature of the product life cycle is the difference between these two curves. An understanding of the curves helps marketer to prepare marketing strategies for the product.
Product life cycle study governs strategic marketing planning at all levels. That is, it is not only involved in product planning and development, but also in pricing, product promotion and distribution policies.
The product life cycle concept is used in formulating appropriate marketing strategy and its prompt implementation. That is, long before the sales decreases, one can notice a substantial decrease in the profit margin from the product.
This characteristic of the product helps the marketer to think more beyond the current product. A marketing manager must constantly generate a continuous stream of products or product features in order to maintain market position. This also helps in stabilizing the company image and in holding the profit at desired levels.
The concept enables the marketing manager in planning the entry of new products in a chosen market. Marketers can alter the product life cycle primarily through product improvement that is, altering the product features and also through parallel changes in the marketing mix.
As any marketing manager can realize, it is far less costly to improve an existing product rather than going for a new product. So new product features as well as new products are the real solutions
Product life cycle study also helps in postponing the desired life phase of a product. For example the study of PLC helps marketers to expand the maturity phase of their highly profitable and popular products.
Marketer must also consider the change in the relationship between sales revenue and profitability in the allocation of marketing and other resources among parts of the product line.
The product life cycle hence is very useful for the management of the life cycle of your product. And this can be achieved by corporate strategic planning and marketing strategic planning.