Describe how marketing strategies change during product life cycle. Also identify and discuss some potential problems with product life cycle.


CSS Solved Business Administration Past Papers | Describe how marketing strategies change during product life cycle. Also identify and discuss some potential problems with product life cycle.

The following question is attempted by Miss Nimra Masood, the top scorer in CSS Business Administration papers. Moreover, the answer is written on the same pattern, taught by Sir to his students, scoring the highest marks in compulsory subjects for years. This solved past paper question is uploaded to help aspirants understand how to crack a topic or question, how to write relevantly, what coherence is, and how to include and connect ideas, opinions, and suggestions to score the maximum.

Topic Breakdown:
Business Management is incomplete without an effective marketing strategy; therefore, in-depth study of marketing concepts is key to scoring good grade in this paper. Understanding product and its fluctuating demand is part of a useful marketing strategy.
Subject: Marketing
Chapter: Product Life Cycle


The whole concept of marketing revolves around product, pricing, placement and promotion. Product is the first and foremost pillar of marketing as it defines what the company is to offer and the target market. Product life cycle is different phases throughout the useful life of a product. Marketing strategies change in different phases of the product life cycle, as there is change in sales and profits. There are four stages in product life cycle from introduction to decline; each stage having its benefits and drawbacks. While most companies rely on product life cycle to define there marketing strategies; unfortunately, it does have potential problems.

Product Life Cycle Stages and Change in Marketing Strategy:

  1. Introduction:

This stage is known for the introduction of the product and made available for purchase. This stage is characterized by low sales and; hence low profits. The company may have to bear some financial losses initially; however, it has a benefit of few or no competition. Nonetheless, company may have high initial cost due to innovation and research. Failure at this stage is worst as first bad experience will never bring back the customer.

  • Marketing Strategy:
    The prime focus of marketing strategy is to increase sales for the product. At this stage the company has two marketing options: market skimming or market penetration. Market skimming is the strategy to gain maximum profits by charging the optimum price. Company adopts such strategy when market size is limited, low competition and customer is price insensitive. On the other hand, the strategy of market penetration focuses on increasing sales by keeping minimum profits. Companies go after a large market share, in a considerably large market, high competition and customers are price sensitive.
  1. Growth:

The second stage of product life cycle is growth, where sales and profits both are rising consistently. Costs at this stage  costs start to lower as companies move towards economies of scale. However, at this stage, competitors have completed their product analysis; therefore, competition starts to increase.

  • Marketing Strategy:
    Sustaining rapid growth is the prime purpose of this phase. Firms may decide to improve product quality or add new features. Another aspect of marketing strategy is to find new distribution channels to penetrate market easily.
  1. Maturation:

The third and most crucial stage of product life cycle is maturity. In this phase the sales growth slows down and at a point levels off. At this stage the competition and profit is maximum. The competition focuses towards price cuts, innovations and promotion; thus, company starts focusing on survival. While some companies remain unchanged for longer periods, proactive companies evolve continually to cater changing customer needs.

  • Marketing Strategy:
    At this stage the company has multiple marketing strategies to adopt. Market development strategy considers identifying new market segments for the products available. Product development strategy finds new ways to modify product or introduce new ones to same market segment. Thirdly, the diversification strategy looks to startup or acquire new business with new products in a new market segment.
  1. Decline:

The last stage of life cycle witness a persistent fall in profits, sales and competitors. Companies may limit product offerings or exit smaller market segments. Reducing expenditures and price cuts are the prime focus.

  • Marketing Strategy:
    The last phase also has a number of strategies to decide from. Harvesting strategy focuses on maximizing the life of a product but with little or no promotion. It allows company to gain time to establish new product and adjust to reducing cash flows. Phased withdrawal is another strategy where product is removed from different segments or distribution channels. Contracting or selling out is the third strategy where loyal customers can continue buying product from a niche product that finds it difficult to build a brand name.

Drawbacks in Product life cycle:

  • The biggest drawback is that it is unable to predict the time product will spend in each phase.
  • At instances it becomes difficult to differentiate between different stages. Some products may reach the decline stage before reaching maturity.
  • Companies need considerable amount of data to determine the phases of product life cycle. Incorrect or misleading information may be damaging.
  • Marketing Conditions have an influence on the product life and its performance.


A clear understanding of the product life cycle is necessary is devise an effective marketing strategy. Every stage has its own strengths; hence, strategy must adopt to take maximum advantage. While the costs are high in introduction stage, the companies focus on sustaining. Furthermore, apart from molding marketing strategy, marketers must also focus on prolonging the maturity phase to gain maximum benefit. Nonetheless, product life cycle also has certain drawbacks that must be considered when formulating a marketing strategy.

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