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Marketing managers are expected to possess knowledge in a vast variety of subjects to be successful. They should not only know everything about the market but have a sense of the products which are worth developing and producing. This is why the concept of the product life cycle can be regarded as the most important for them to know because it has a direct connection with marketing management and, correspondently, such notions as advertising, demand, supply, consumption, etc. Product life-cycle is, as a rule, used by security analysts to explore rapidly changing industries. (Warwick & IMCA 2003) The product life cycle is an extremely useful tool for marketing managers because, as the examples of The Coca-Cola Company and Nike show, it is universally applicable to any company and helps to anticipate the development of the company’s product.
Stages of the Product Life-Cycle
The life cycle of any product consists of five universal stages. The first stage is introduction; this stage takes place when the product is first introduced into the market. Another stage is growth; during this stage, the product gains popularity among the consumers, and the revenues from its sales increase. At the maturity stage, the product already has a well-established consumer base; the profits from its sale are almost invariable and the consumers trust the manufacturer. Then follows the decline stage at which the consumers lose interest in the product and its sales fall. Finally, there comes withdrawal, a stage at which the demand declines and manufacturing the product does not make any sense. (Waters & Waters 2002) The products of any company go through all these stages.
The Coca-Cola Company
The history of the Coca-Cola Company is long and its main product, Coca-Cola, is currently on the maturity stage. The product was on its introduction stage in the late 1890s when it was first invented. The product was in its growth stage when the company introduced certain innovations into its production. The drink used to be sold from the soda fountains and the company’s decision to start producing it in the bottles brought the industry enormous profits. (Just for the Taste of It 2000) The growth stage ended in the 1990s with the brand’s passing to the maturity stage. The product gained worldwide recognition and still remains popular due to the company’s keeping the formula of the drink secret.
Nike products have undergone the same stages as Coca-Cola. The company started functioning in 1964 as Blue Ribbon Sport; this can be regarded as its introductory stage for it is namely then that the interest of the consumers in the brand started arising. At the growth stage, the company was renamed after which it started developing even more rapidly. At this stage, the company started marketing the products not only under its own brand, but also under its subsidiaries, such as Converse, Cole Haan, Umbro, and Hurley International. (Plunkett 2005) Despite high competition, the company managed to transfer to the maturity stage and is currently enjoying world popularity and recognition.
Taking into consideration everything mentioned above it can be reiterated that the concept of the product life-cycle should be one of the main tools of the marketing manager. Its applicability to such huge companies as Nike and The Coca-Cola Company shows that it is an integral part of marketing which allows anticipating the company’s development and looking back at its performance throughout the years.
- ‘Just for the Taste of It,” The Irish Times, 2000.
- Plunkett, JW 2005, Plunkett’s Retail Industry Almanac 2006: The Only Complete Reference to The Retail Industry, Plunkett Research, Ltd., Houston.
- Warwick, B & IMCA 2003, The Handbook of Risk, John Wiley and Sons, New York.
- Waters, DC & Waters, DJC 2002, Operations management: producing goods and services, Pearson Education, London.