product development life cycle icon

Product Development Life Cycle

Things and ideas are alive; they come to life and die as humans do. Their lives are stories – some are straightforward and ordinary to the point of being boring, some are full of ups and downs, abrupt twists, and breathtaking moments. If we put aside romanticism and look behind the veil of the metaphors, we will see a definite scheme, a step-by-step outline. Every life, be it Einstein, a kindergarten hamster, or a revolutionary gadget passes similar life cycle milestones: conception, birth, life, and death. The same scheme works for products, hardware and software. Let’s explore each stage and examine what happens along a product’s life cycle.

Product Development Life Cycle in a Nutshell

To define what, when, and why happens to a product, marketers and executives came up with a concept of a product development life cycle (PDLC). In brief, the product development life cycle is a series of consecutive stages that a product passes through. Usually, the entire path is broken into four periods – introduction, growth, maturity, and decline. To make the cycle more complete and coherent, we suggest adding a development stage and a product’s afterlife period.

The product development life cycle overview

Each stage is characterized by specific indicators, such as sales and profit, the level of customers’ engagement and brand recognition, the intensity of competition, and the number of rivals. At each stage, different departments take the burden of the highest responsibility, decision makers focus on various aspects of a product, and marketers come up with diverse promotion strategies.

As the context in which a product functions differs throughout its life cycle, the business activities must be adjusted to the current requirements. Otherwise, a product may fail to outlive the competition and hold its niche. For this reason, decision makers and heads of department must review the strategy and make requirements analysis iteratively, to make sure they are up to date with the context. Besides, each stage offers opportunities and imposes challenges – some factors are beneficial while others are unfavorable or even harmful, and marketers have to deal with them, adapt quickly, and adjust the product.

Even if the scheme, be it hardware or software development life cycle, proves to be working, it is more of an ideal outline rather than a guaranteed forecast of what will happen to your product. Products may persist at the maturity stage and never move to the decline, or they may skip certain steps – for instance, drop abruptly from the growth stage into oblivion. Besides, a life cycle does not have any time frames; some products may pass all the stages in a year while others take several decades.

You may start wondering what the point of a PDLC if it is not always identical, if you can’t predict the duration of stages, if the unforeseen factors may intrude and mess up your product’s expected path. The answer is simple: a product development life cycle is a guideline for your business, a scheme to consider.

When you understand what you can expect and how your product should mature, it will be easier for you to spot and deal with emergencies. On launching a product, you may consider the ideal scheme and try to prepare for the potential pitfalls that could await your product at each stage. For sure, long-term planning rarely covers all the possible threats and predicts all the success points, but it is better to keep several scenarios in your head. However, the mere knowledge of the stages has little value – you should apply it in your marketing strategies, price policy, and day-to-day tactics. Not being a rigid frame, a product development life cycle leaves you space to adjust it to the context and the niche you work within. Critical thinking should always be critical.

Milestones of a Product’s Life Path

Usually, a product life cycle is divided into four discrete stages:

  1. The introductory stage when the product enters the market
  2. The growth stage when it establishes its position and brings the most profit
  3. The maturity stage when it stabilizes in the market and has the highest sales volumes
  4. The decline stage

Product Development Life Cycle overview

However, before a product appears in the market, it inevitably goes through a period of conceptual elaboration and engineering. Hence, the development stage should not be excluded from the life cycle. Besides, the decline stage also leads to several diverse scenarios, as not all the products exit the market through the same door. We will refer to this period as the afterlife stage. After adding two extra steps, the classic image of the product life cycle expands and starts to resemble the drawing of Exupéry’s hat from The Little Prince.

Product life path

Each of these phases has vital characteristics and indicators for evaluation, a clear purpose, several connected goals to achieve, exit criteria, and conditions for the transition to the next stage. However, the transition from phase to phase does not occur overnight and does not have a distinct milestone to identify the end of one stage and the beginning of the next. Even though the borders separating phases are blurry, a general overview of each period will come in handy for an understanding of the path each product completes.

New Product Development Stage

New product development

The development stage is a period between the emergence of the idea and the introduction of the product to the public. Compared to human life, it is like the evolution of a fetus – from conception to birth. For a new product, it is the most stressful and resource-demanding period.

First of all, you need a competitive and realistic idea to embody in your product. To do that, you need a skilled team to research the market, specify the product requirements, work on prototypes and design, test them and analyze mistakes, and lead the engineering process to the point of perfection when you have a ready product to introduce to the world. Thus, the development stage takes a lot of time, money, and professional effort. The process of new product development is complex and multi-sided, and requires an in-depth, step-by-step overview.

Even when all the best practices of Agile are applied, the development stage is exposed to sudden failures and insuperable pitfalls. Together with the intro stage, it is the most dangerous and hard to pass one.

Classic View on the Product Life Cycle Stages

When you are ready to show the results of your work, the main part of the product life cycle begins. Usually, it follows an S-shape curve, pictured in the graph below.

The Introductory Stage

Introductory stage of product development life cycle

The first time your product appears in the market marks the beginning of the introductory stage, also known as a market development period. At this time, you are about to:

  • build the brand and acquire product acceptance through promotion.
  • build a base of customers – aim at innovators and early adopters who would serve as your key endorsers.
  • establish your distribution tactics – it may be selective, aimed at a specific niche, or flooding, offering trials, samples, and discounts.
  • decide on the price – it may be higher to cover the initial expenses or lower to gain the market share.
  • take care of intellectual property rights.

The duration of the stage heavily depends on the product itself. The key to success is the demand. The higher the need for your product is, the faster it will transition from the introductory stage to the growth stage. You can have a fantastic and working idea, but if no one needs your product, you are in trouble. For instance, if you develop an effective medicine for HIV, it will immediately rocket to the growth stage and conquer the market. However, if your product is another weight-loss pill, it has a long way ahead and may never make it at all. If your product is familiar and straightforward, it will be easier to spread it to the masses, but it is likely to face more competition. On the other hand, if you have a complex, utterly novel product that is not entirely intuitive and requires some additional skills, it will take more time to proliferate in the market. Hence, before you launch your product, make sure that there is a demand for it, or that your marketing department is capable of creating one.

The introductory stage is the riskiest one as the hazards are not always obvious and could kill the product at the very beginning. Besides, at this phase, be ready to deal with:

  • low profits as the number of your customers is small.
  • slow sales and gradual development of the client base.
  • little or no competition if you are the first to take the niche.
  • high budget for marketing and promotion.
  • time-consuming education of the customers.

The Growth Stage

The growth stage of the product development life path

If everything goes well, after the initial introduction, a product starts gaining users and bringing profit. The growth stage is the time when you obtain the most profit. It is likely to increase rapidly and reach its peak before the maturity stage. During this period, you already have a customer base, your brand awareness expands, new customers join your network, and the demand multiplies. Even if your product is not expensive, the boom in sales and the active flow of new clients bring you high profits.

At the growth stage, you need to:

  • provide a product of high, stable quality so that your new clients get what they expect.
  • stick to a stable price policy.
  • continue investing in marketing to reinforce your brand message and make your users loyal.
  • think of the most efficient distribution channels to guarantee product availability.
  • add new features and improve the design to expand the presence on the market.

Even though the competition is still low, the first rivals appear. They watched your success, and may offer almost the same product as you do, but slightly different – for instance, use other materials, change the design, etc. That is why, at the growth stage, you need to make your brand distinguished and gain the loyalty of customers, especially those who would endorse your product. By the end of this phase, the number of competitors grows, and you face the need to protect and hold your position.

The Maturity Stage

The maturity stage of the product development life path

After rapid growth, a product is likely to enter a phase of steady existence. The maturity stage is also known as the phase of stabilization and saturation. This is the time when your sales hit peak – the majority of your potential clients get your product, and it leads to market saturation. It means that you have to come up with new offers to compete with rivals. Those of your competitors that entered the market at your growth stage have now reached their own. And while you are thinking about how to keep your position and hold the market share, they enjoy the growth phase, benefiting from your niche.

In order not to lose what you have achieved, at the maturity stage, you should:

  • enhance features to distinguish your product from competitors.
  • think of improvements to offer something stunning that has not yet come to the minds of your rivals.
  • explore new markets and expand the distribution networks to gain more customers.
  • lower prices to maintain the client base and prevent them from switching to competitors.
  • allocate your resources to marketing.

The price drop is almost inevitable. Even if you do not have any strong competitors, your customer base is already saturated, and it will not bring you as much profit as it did before. To prevent profit from dropping, you need new users and new niches.

The maturity stage does not have a definite time frame: it may last for decades. Some products remain at this phase as there are no reasonable substitutes (beer, steel, etc.); some, as they have achieved the status of a classic, even cult item (Converse shoes). If your product does not have such a promising potential, there is not that much you can do to prolong the maturity stage. The only thing to prolong the life cycle and prevent your product from falling into oblivion is to create conditions for more frequent and varied use of the product.

The Decline Stage

The decline stage of the product development life path

Sooner or later, the maturity stage ends with the decline. It is not going to happen at the click of a finger, but, eventually, you will notice a steady, gradual decrease in your sales and profits. Usual marketing tricks and technical improvements will not help – they may only slow down the decline. At this phase, you need to have the guts to:

  • deal with the competition that escalates.
  • lose your customers to a newer, better alternative product.
  • drop down the prices as low as possible to maintain your client base.
  • work on an alternative product, the one to substitute the current product but transformed and improved in a way to be competitive and attractive.
  • radically change the target audience in the hope of reviving the interest.

Even after doing your best and jumping over the head, your product may not be among those capable of surviving the competition. In such a case, to stop production and discontinue the product could be the best choice.

Product’s Afterlife Scenarios

The last stage of the product development life path

Often the decline stage means a slow death of a product and its dive into oblivion. However, occasionally, the end of the life cycle is not as pathetic and doomed. Let’s cover several possible scenarios a product could take a role in after its life is over.

1. Gradual or immediate death

Some products no longer have any use. They have performed their function and are completely outdated. Harsh competition, improvement of technology, new scientific discoveries, a shift in values, and plenty of other reasons may make a product useless and not in demand.

For a manufacturer, it means that there is no reason to struggle, and it is wiser to give up than to go on. In the worst case, a product proves to be dangerous or harmful. It should be withdrawn from the market immediately and destroyed to protect users.

2. Hereditary through transformation

A product may be useless as it is at the time of decline, but, with certain transformations, it could come back to life. In such cases, manufacturers take a dying product as a base and enhance it with more up-to-date materials, change the design, make it in line with customers’ expectations, and coherent with trendy values. Thus, it is no longer an old version of the product, but serves as a base for a new one, transmits its genes, and enables the emergence of the next generation.

3. Inspiration (positive or negative)

The most honorable outcome for a product is to become an inspiration for a new one. Inspiration is always a part of the hereditary process, but it can also be a separate case – for instance, when a gone product serves as a muse for products in different industries.

However, inspiration does not necessarily have to be positive. A product may serve as a warning, inspire manufacturers to do everything totally differently, and stop them from incorporating the product’s flaws – design, materials, technology, etc.

4. Relic

When a product is no longer available in the market, it may become a relic, a valuable item for collectors, museums, etc. It may serve as a nostalgic marker of a cultural epoch, phenomenon or event, or be used in movies or art installations. From an economic point of view, it does not bring any profit to its manufacturer, but, as an object, it may continue its life cycle.

5. Resurrection

Long gone and forgotten products may revive, come back from oblivion, and start their life cycle all over again. Usually, they are modernized and brought into accordance with the up-to-date customer requirements and values. Resurrection differs from the hereditary stage in terms of time: hereditary is smooth, sequential in time, following the initial product, while resurrection means the revival of a product that left the market years or decades ago.

Guidelines to Spot a Product’s Life Phase

In the table below, we aggregated all the basics regarding each stage. Keep in mind that, depending on the product, they may vary. Also, in the table, there is no afterlife stage as the scenarios are way too unique and specific in each case.

Product development life cycle overview

 DevelopmentIntroductionGrowthMaturityDecline
Product's evolutionInitial idea
Working prototype
First items for sell
Initial working productPerfection of the features to build up a solid product imageAdditional features and supplementary products to distinguish from competitorsMajor product transformation or a complete redesign
Customers NoneInnovatorsEarly adoptersMass marketLoyal users
Low-price hunters
Marketing strategyMarket research
Buzz
Brand building
Buzz
Gaining loyalty
Reinforcement of the brand message
Intense promotion
Market expansion
Fight for the customers
Keeping the loyal (e.g. with discounts, new offers)
PurposeCreation of valuable, working productBuilding demand and customer base
Cost-effective production
Gaining market share and establishing positions
Reduction of manufacturing cost
Maitainance the market share
Outliving the competition
Exiting the game with dignity
Indicators
- salesnonelowhighmaximumlow
- profitnonelowmaximumhighlow
- investmentsmaximumhighhighlowlow
- competitionnonelowmediumhighmaximum
Exit criteriaThe product is ready to enter the marketThe profit and sales levels start to grow rapidlyThe profit level stabilizesThe profit and sales levels start to declineThe product is no longer economically viable
BenefitsOpportunity to create its own niche and demand for the productAlmost no competition
High price and growing profit
Lower production costs
Higher consumer awareness
High profit
Further reduction of the production costsCheap production
Opening new markets
ChallengesHigh resource demand (time, effort, money)No market and low sales
First products are expensive
Increasing competition
Need to lower prices
Intense competition
Profit decline
Need to think of product improvements and new markets
Low profit and sales
Need to withdraw the product

Factors to Disrupt a Smooth Life Cycle

The stages discussed above mirror milestones a product passes through on its life cycle. Their duration is hard to predict, and the borders between phases are blurry. Besides, at any stage, a set of unexpected factors may emerge and affect a product’s life cycle. Usually, these issues are out of manufacturers’ control and, for this reason, they are of great danger.

The factors to intrude into a product life cycle are endless, and we will list only a few of them:

Scientific discoveries and technological advances

Scientists could make a sudden discovery considering, for instance, the material you use in production. Similar to the Teflon case, the findings may point to the harmful effects of the material, underlining the toxicity of your product.

Values shift

Social movements and views influence the mass market and impose requirements on consumer goods. The trend for eco-products emerged from the postulates of social activists. The views proclaimed and incorporated by an average consumer require your product to adjust.

Shift in fashion

What is fashionable and demanded today may fall into oblivion or become a theme for mockery tomorrow. If you are not an innovator, the risk your product will be regarded as unfashionable grows.

The emergence of competitive substitutes

A cheaper, better designed, more convenient, and generally more appealing alternative to your product may appear out of the blue and attract the attention of your customers, stealing your market share.

Political reasons

Deterioration of the relationship between countries may lead to a decline in the trade or even to its termination. If your product is targeted at foreign markets, you may lose the majority of your customers.

Economic stability

An economic crisis may cause impoverishment and affect the buying capacity of customers. If only a small part of your initial customer base can afford your product, you need to think of alternative niches, cheaper production methods, and other ways to keep your product affordable and demanded.

Natural disasters

A hurricane or flood may destroy your production capacities, leaving you without the means of production. In such a case, the price for your product would rocket, and you may lose your potential customers.

It not always the case that these factors have a negative impact on the product. For instance, a sudden break up of the political relationship between two countries may remove a foreign product from the market and give the green light to a local substitute. In such a way, a product may teleport from the introduction stage directly to maturity, almost skipping the growth stage.

Real-Life Product Life Cycles

The theoretical part above may sound unfounded. To eliminate this impression, let’s consider two real-life examples of one product that passed all the stages of the life cycle and another product that stayed at the maturity stage.

Several Decades of the Pager’s Life

Before the epoch of mobile and smartphones, pagers (or beepers) were on the list of necessities of everyone who considered themselves a businessman. The device was handy and simple to use – anyone with your number could reach you, you got their message, and the connection between you two was stable. Pagers had no excessive functions and served one purpose.

The introduction of the pager can be tracked back to 1949 when the system itself was patented. In the 1950-70s, the technology went through the introductory phase – in 1958, it was approved for public use. In the 1960s, the first pagers, such as Bellboy and Pageboy I by Motorola, appeared. At that time, pagers were used by emergency services that had to stay in touch and react immediately when needed. Hence, for approximately two decades, the target audience of pagers was represented by the police, firefighters, and doctors.

In the 1980s, pagers entered the growth stage. The initial years of the decade brought 3.2 million users worldwide. After ten years, this figure was over 22 million, and by 1994 it increased to over 61 million. Hence, in the mid-90s, the maturity stage began for pagers. It lasted until the beginning of the 2000s when mobile phones became cheap and affordable. Given the limited functionality of pagers, they had no chance of surviving the competition with mobile phones. It was the beginning of the decline stage.

In 2001, Motorola stopped the production of pagers. It didn’t mean the industry was completely dead, but it marked a rapid decrease in sales and industry profits. Two decades later, though pagers are no longer used in daily routines, they still remain in the market. After all these years, their target audience shrunk back to those working for emergency services. As pagers do not depend on Wi-Fi and cellular networks, they are more reliable in transmitting messages under the conditions of low or even no other signal but satellite. Thus, for pagers, the decline stage may last for several more decades.

Success Swings of Dr. Martens Boots

The image of massive, somewhat brutish Dr. Martens boots is timeless. Established in 1947 in Munich, the footwear brand was popular with workers, rock stars, young rebels, and ordinary citizens for over 70 years.

The introductory phase took Dr. Martens 5 years. During the initial years of production, the shoes were most popular with men working in construction. But, in 1952, the growth stage began as the sales started to increase rapidly: the boots got popular with workers, the police, mail carriers – all those who needed comfy shoes for the entire working day. By 1959, the growth intensified as the British manufacturer bought the patent, and the brand went international.

In the 1960-90s, Dr. Martens boots were consecutively adopted by various subcultures: in the 60s, by British skinheads; in the late 70s-80s, by punks, goths, and football hooligans; in the 90s, by grunge lovers. During the 1990s, stable demand and customer base guided the brand into the maturity stage. In the last years of the decade, the brand was producing over 10 million pairs of boots per year, with annual revenue of $412 million.

However, in the 2000s, rock music made way for hip-hop culture, and the sales of Dr. Martens dropped dramatically. By the mid-2000s, the production shrunk to 5 million pairs, the revenue fell to $127 million, putting the manufacturer on the edge of bankruptcy. To get out of the decline phase, the brand moved production from the UK to Asia, closed several stores and factories, and cut the number of employees.

Aside from the restructuring, Dr. Martens undertook other actions to stay afloat:

  • redesigned and widened the range of models and colors, offering over 450 styles today.
  • introduced a clothing line in 2011.
  • introduced “vegan” shoes to stay in line with the trend of eco-friendliness.
  • collaborated with designers (e.g., Marc Jacobs), featured the boots in fashion shows of Yohji Yamamoto and Chloé.
  • presented boots to young rock stars (such as Avril Lavigne in the mid-2000s).

In 2012, Dr. Martens was back in the game again, named the 8th fastest-growing British company. In 2018, the firm produced 10 million pairs of boots. After 20 years of decline and struggle, Dr. Martens climbed back to the peak. And, in 2019, its annual revenue was $582 million, taking the brand back to the maturity stage.

The 70-year history of Dr. Martens shows how wise management and targeting may keep the brand from death and even rocket the sales again. Fashion swings, cultural shifts in music and counterculture, economic challenges of the production contributed to the hardship of the manufacturer. Together with the brand, its most notable and iconic model – the 1460 AirWair boot – went through all the stages of a product’s typical life cycle. Created on April 1st, 1960, this pair of boots is still on the shelves of the Dr. Martens stores. And, sixty years later, they were picked as one of the icons of British design.

Final Remarks

The product life cycle, with all its stages, characteristics, benefits, and challenges, is a helpful conceptual frame. It gives relief and makes the unknown comprehensible. As a developer, producer, manufacturer, you can scheme it and relax. Although you can’t predict exactly what will happen to your creation, you have an outline of how things should go in the ideal scenario. You may plan beforehand your marketing strategies for the maturity and decline stages, think of the hazards and risk factors that may intervene in the cycle, and come up with a plan B.

There are zero guarantees that your product will go from stage to stage, fulfilling all the expectations and following the prescribed changes in indicators. But, like any other conceptual frame, the product life cycle is there for you to create a sense of control over the process. It costs you nothing to apply it while dreaming of your product’s future. And, perhaps, it will serve you as a shield from the unexpected.