According to the strategic management and marketing study domains, PLC may be seen as a significant aspect impacting corporate strategy. The product life cycle is the behavior of sales and earnings over time for a particular product or type of goods (Gitman, 2018). As the product progresses through its life cycle, the company must continually revise its marketing mix to remain competitive and suit the expectations of its target consumers (Gitman, 2018).
The essential component in choosing a suitable business strategy is the stage of the product life cycle, and Major adjustments in corporate strategy are frequently necessary throughout four phases of the life cycle: introduction, growth, maturity, and decline (Gitman, 2018). Regarding the large diversity of hypotheses offered by numerous researchers to highlight the varied qualities of PLC phases, it is contentious how to behave in different stages.
Upon successful creation of a product, the product needs to be presented in its specified target market. This aids the target consumers in obtaining the goods (Gitman, 2018). This is the firm’s initial move towards ensuring that there is adequate market awareness about the product (Gitman, 2018). Significant money is spent during the introduction phase. For instance, the successful launch of a product in the market is decided by the efficacy with which the business has tested the market.
Typically, this is the stage whereby a product is offered to the market. Usually, the prices are maintained as low as possible to gain the most market share. In the case of high-end devices like the Apple iPhone, the launch method is different. In the Introduction Stage of the Product Life Cycle of the Apple iPhone, the price is maintained high so as to retain the exclusivity of possession. iPhone consumers would only like some to possess an iPhone; that is why the price is thus preserved so as to attract just a premium portion of the public. During the initial period, advertising, sales & marketing expenditures are generally considered.
Coupled with low pricing, this leads to a time of negative profitability/loss for the firm. The first point is true for the iPhone as well. In order to host Keynote conferences and establish advertising and marketing initiatives, it needs to spend a lot of money. Moreover, consequently, at the Introduction stage of the product life cycle of the Apple iPhone, the firm needs to earn money right from the first day.
At the growth stage, the product has already infiltrated the market. As a consequence, the firm’s level of profit is boosted owing to a high rate of sales growth (Gitman, 2018). In addition, corporations achieve economies of scale during this period allowing them to build their competitive edge over price. This originates from the fact that a large number of prospective investors are enticed to enter the sector. As a consequence, it becomes necessary for organizations to adopt methods targeted at growing the brand. One of the tactics refers to market communication strategies.
In consideration of the iPhone, a person may notice that the previous model iPhone 13, and its variations are in this stage. iPhone 14 has already been presented to the market; however, owing to the fact that the 13th model is still fresh and has strong popularity, the price gap between the two versions is small. By the end of 2022, the price for iPhone 14 is 799$ while iPhone 13 will be at the threshold of 599$ (Apple, 2022). Consequently, with the decrease in the price, the 13th model is shifting into the mature stage.
The mature stage is common in all the items. At this level, the degree of competitiveness across competing enterprises is quite high (Gitman, 2018). This stems from the fact that all enterprises are trying to keep their market share (Gitman, 2018). In addition, companies obtain the largest amount of profits in this period. However, the increase in sales is at a modest pace until they stabilize. During this period, the pace of rise in sales may fall, but the total sales are maintained at a set level. By this time, various rival items had joined the market. Some of them may be legitimately excellent things.
However, some of them will be clones of the company’s product. Currently, the 12th generation of iPhones and SE models are in a mature period when sales have stabilized. Their pricing is inexpensive, which enables the client to contemplate the purchase at any moment in favor of the brand while giving up on certain features available in newer versions.
At the stage of decline, the market for the product diminishes, resulting in a fall in the amount of profit within the industry. The decline may occur from a change in customer tastes and preferences or the arrival of alternative items which are more inventive (Gitman, 2018). This has occurred with iPhone 11; this model is still in high use and sold in numerous electronic stores but is no longer included on the official website of Apple Inc. Thus, proving that the corporation is no longer going to develop this model and manufacture branded accessories for the model.
In conclusion, the product life cycle represents the strategic development of the product from its introduction to decline and disregard in the market or by the company. Apple has various products that underwent such a cycle, starting from early models of personal computers to smartphones. Currently, the iPhone 14 model is in the introduction stage, the 13th model is in the growth stage, the 12th gen is within maturity, and the 11th version of the popular smartphones is experiencing a decline.
Reference List
Apple Inc. (2022) Apple. Web.
Gitman, L.J. et al. (2018) Introduction to business. Houston, Texas: OpenStax.