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Product Life Cycle

Part 5. Product Innovation and Management

  1. Peter N. Golder1,
  2. Gerard J. Tellis2

Published Online: 15 DEC 2010

DOI: 10.1002/9781444316568.wiem05005

Wiley International Encyclopedia of Marketing

Wiley International Encyclopedia of Marketing

How to Cite

Golder, P. N. and Tellis, G. J. 2010. Product Life Cycle. Wiley International Encyclopedia of Marketing. 5.

Author Information

  1. 1

    Tuck School of Business at Dartmouth College, Hanover, NH, USA

  2. 2

    University of Southern California, Los Angeles, CA, USA

Publication History

  1. Published Online: 15 DEC 2010

Abstract

The product life cycle (PLC) is a central, enduring framework in marketing. The four stages of introduction, growth, maturity, and decline are appealing intuitively and are supported empirically in recent research. Here, we draw on several literatures to develop an integrated theory to explain the observed shape of the PLC. We present specific definitions and metrics for key events and stages of the PLC. On the basis of these definitions and metrics, we present generalizable results for many characteristics of the PLC based on a sample of 30 consumer durables. Results include duration of stages, sales volume, sales growth, price reductions, and penetration. There is a dramatic increase in sales at the transition from the introduction stage to the growth stage, and a sudden change from sales growth to sales decline at the transition from the growth stage to the maturity stage. Overall, the PLC is a useful framework for understanding and anticipating the sales growth of new consumer durables.

Keywords:

  • diffusion of innovation;
  • sales takeoff;
  • Bass model;
  • new products;
  • informational cascades