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PLC and Boston Matrix - Coggle Diagram
PLC and Boston Matrix
PLC (Product Life Cycle)
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The Product life Cycle is the stages in which products go though during their lifetime from development to withdrawing from the market. It primarily looks at sales
Stages
Growth
Growth is the third stage of the Product Life Cycle, it is the stage where product sales start to increase rapidly. Sales start to increase at a faster rate than before while costs are decreased because of economies of scale and lower marketing. Some products begin making profit at this stage
Maturity
Maturity is the fourth stage of the Product Life Cycle, it is when sales start to slow in their increased because most people who wanted the product have already brought . Costs are low due to economies of scale while sales and profit are at their highest for the product.
Introduction
Introduction is the second stage of the Product Life Cycle where the product is first introduced to the market. Sales are low initially because it has just been introduced and so therefore demand will be low but will grow as it establishes a customer base for itself. Costs are usually high due to R&D and marketing so businesses usually lose money at this stage
Decline
Decline is the fifth stage of the Product Life Cycle, it is when sales for the product begin to decrease and usually continues to decrease until it is withdrawn from the market or an extension strategy is implemented. Sales begin to fall as demand shrinks for the product until it begins to lose money and eventually is withdrawn fro the market altogether, costs are still relatively low as it is mainly only costs of production being the main cost
R&D
Research and Development (R&D) is the first process of the Product Life Cycle. It is when the business is developing the product to make it ready for the market, usually the most expensive stage as costs are huge due to development and research and no sales are being made
Extension Strategies
Extension Strategies are the optional sixth and final stage of the Product Life Cycle, it usually happens during the decline stage where the business attempts to change the marketing mix of the product in order to increase sales.
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Boston Matrix
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The Boston matrix is a business theory proposed by the Boston Consulting Group to help divide Business's portfolios
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