As with all living things, products have finite lifespans. This is particularly evident in the healthcare industry where continuous innovation and change have become commonplace.
Regardless of the particular healthcare component examined- medical technologies, pharmaceutical products, surgical techniques and procedures, durable medical equipment manufacturing, service delivery systems, and so on-innovation is pervasive.
Not only do products possess limited lifespans, but like their living counterparts, their lifespans consist of a number of developmental stages, with each of these stages presenting its own unique array of opportunities and constraints. Products must be managed differently during the different staged of their life cycles, these stages of development are defined as follows:
Stage 1: Introduction
The introduction stage of the product life cycle involves the initial presentation of a product in the market. During this stage, sales growth slowly begins to increase as the public begins to gain awareness of newly introduced product offerings through promotional efforts. Here, marketers are primarily concerned with developing innovative promotional strategies that will increase product awareness in the market.
Stage 2: Growth
The growth stage of the product life cycle is characterized by rapidly escalating sales, courtesy of increased product awareness. This rapid sales growth generates large amounts of cash, but it also attracts competitors to the market. During this stage, marketers shift their attention from building product awareness to brand awareness.
Stage 3: Maturity
During the maturity stage, sales growth levels off in what has now become an established market. Here, marketers seek to increase market share by further differentiating their products from competitive offerings.
Stage 4: Decline
During the decline stage, sales growth rapidly decreases, as well as a number of competitors in the marketplace. Here, marketers either eliminate these products or seek to extend the life spans of declining offerings through the discovery of new products uses or through product repositioning.