[Articles](/articles.html)>[Marketing](/articles.html#marketing-articles)> What are the stages in a product life cycle?
# What are the stages in a product life cycle?
September 23, 2026 • 8 minutes
Written by[Dillon Price](/blog/authors/dillon-price.html)
Reviewed by [Kathryn Uhles](/about/academic-leadership/dean-kathryn-uhles.html), MIS, MSP, Dean,[College of Business and IT](/about/colleges/college-of-business-and-information-technology.html)
Every product follows a path from launch to retirement. For businesses, understanding each stage of that journey can mean the difference between a thriving product and a costly misstep.
## What is the product life cycle?
The product life cycle encompasses the time from when a product launches to the day it’s taken off the market. Marketers and[brand managers](https://www.phoenix.edu/articles/marketing/how-to-become-a-brand-manager.html)use the cycle to make decisions on sales and marketing, like changing prices, reinventing packaging, increasing advertising or entering new markets.
The cycle is influenced by evolving market trends, emerging technology, economic conditions and the competitive environment.
The purpose of this concept is to help businesses understand:
- A product’s market dynamics and consumer behavior associated with the stage it’s in
- Which strategies work best for each stage of a product’s life, so marketing efforts and resources can be properly allocated
- What revenue, profits and difficulties to expect at each stage of a product’s life so businesses can create more accurate inventory and financial plans
## What are the five product life cycle stages?
If an idea appears to fill an industry gap, a company may proceed to build the product or develop a service. From there, a product typically goes through five key stages: research and development (R&D), introduction, growth, maturity and decline.
### 1. Product development
During R&D, a product may require prototypes designed and tested with care and then analyzed against market demands before reaching the introduction or launch stage. R&D can help companies save time, keep their efforts consistent with their product road map, and potentially steer clear of unproductive development efforts.
### 2. Introduction
The introduction stage refers to when a product debuts to customers, usually through a product launch and marketing. Businesses may communicate their[value proposition](https://www.phoenix.edu/articles/business/how-to-write-a-unique-value-proposition.html)and spread awareness about the benefits a new product can offer.
During this period, potential competitors may only get a glimpse of the product. Even if a new product is introduced to compete with what another company is selling, marketing efforts may center on awareness rather than differentiation.
Revenue at this stage is typically slow or nonexistent, and sales strategies are rarely fully developed.
### 3. Growth
If the product sees success during the introduction stage, it then moves to the growth stage. This begins once a product becomes recognizable, popular and successful. The focus shifts to increasing production and availability to meet consumer demands.
This is typically a period of rising sales and growing revenue. Yet, as competitors introduce rival products, companies may need to reduce their prices and accept lower profit margins.
### 4. Maturity
Profitability peaks at this stage in the product life cycle. Marketing and production costs start to decline and the numbers look favorable. But the market doesn’t rest. Competition increases and profit margins narrow as saturation sets in. To counter market saturation, a company might look for ways to innovate and differentiate its product to capture a larger audience.
### 5. Decline
The decline stage is when a product meets its end. Competition grows, alternatives emerge and changes in consumer preferences occur. A company may discontinue its product entirely by stopping production and ending marketing efforts. Other companies might choose to persist by redesigning and repositioning a product or starting over with a new version and a renewed attempt at relevance.
## When does the product life cycle call for extended stage models and other variations?
Some products stay in an extended maturity stage before phasing out due to market saturation, less demand, reduced sales and increased competition.
An example of an extended cycle can be a rust prevention spray that stays in the maturity stage for more than seven decades by responding to customer complaints and making packaging innovations. The chemical formula stays the same, but the spray components become easier for customers to use.
Other products may be short-lived. For example, a well-known soft drink company might announce a new formula for a favorite beverage in response to declining[market share lead](https://www.investopedia.com/terms/m/marketshare.asp). The company’s goal is to spark fresh enthusiasm among consumers.
However, after launching its new product, the company receives several complaints about the formula change, and many consumers demand a return to the older version. Within a few months, the company abandons the new product and brings back the old one.
## What marketing and pricing strategies do companies use during the product life cycle?
The marketing life cycle maps how a product’s promotional strategy must evolve at each stage.
Since the introduction stage offers little in the way of immediate reward, companies find themselves spending on marketing while keeping promotional prices low. This is when marketing campaigns must effectively reach consumers to accelerate sales and generate interest.
Two pricing strategies can serve this stage in the product life cycle. Price skimming sets a premium price for early adopters and lowers it over time. Penetration pricing does the opposite; companies enter low to pull consumers away from competitors, then gradually raise prices as demand increases.
As companies enter the growth stage, marketing strategies involve reaching a wider audience, improving product features and fine-tuning how the product is priced. They might use competitive pricing strategies, such as cooperative pricing — where they match competitor pricing — or aggressive pricing, which is when prices are set below competitor prices.
However, if the product faces high competition, a company may continue to invest in advertising and other marketing efforts in the growth phase. This calls for differentiation rather than awareness. Beyond marketing, a company may collect consumer feedback to enhance its products.
At the maturity stage, a company turns its attention from expansion to preservation by focusing on cost management, increasing distribution channels, retaining customers and differentiating the product to maintain its place in the market. Marketing efforts during this stage are meant to counter the competition.
During the decline stage, marketing investments are cut back, and companies look to emerging markets or new innovations that might help prolong the cycle.
## How do companies measure and monitor progress during each product development life cycle stage?
A thorough product life cycle analysis relies on[business analytics](https://www.phoenix.edu/articles/business/what-is-business-analytics.html)and key performance indicators (KPIs) to get insights that can encourage growth at each stage.
### Measuring product development
When a product is in development, typically the focus is on building a solution to user problems. Companies use on-time delivery metrics to determine the quantity of product backlog items finished relative to all planned items in a sprint or iteration.
### Measuring product launch
The launch stage is a time for listening to consumers. A company should identify who is using the product, get insights from early users and determine which features or aspects resonate the most.
Important KPIs during this stage may include:
- User engagement: Assesses depth value among users
- User conversion: Tracks the number of engaged user
- Feature adoption: Assigns a value to each feature based on usage metrics
- Net promoter score: Refers to how likely customers are to recommend the product
- Customer satisfaction score: Refers to customer ratings on how satisfied they are with a product
- Product market fit: Assesses how well a product serves its customers, as indicated through surveys, cohort retention or tracking referral rates
### Measuring growth
At the growth stage, companies can turn to data mining and seek patterns that show what is working and what the market demands. They generally watch user engagement and net promoter scores closely. But it’s the referral rates, customer acquisition rates, market share and churn rates that have the most impact at this stage.
### Measuring maturity
When a product reaches its maturity stage, a company will want insight into why its current customers continue to use the product. As with earlier product life cycle stages, a company will continue to track user engagement, customer satisfaction scores, net promoter scores or churn rate.
However, the maturity stage demands a measure of the average revenue per user, which often divides revenue by how many customers are using the product. A company should also measure customer retention by gauging daily, monthly and returning users.
If new features are added to a product, companies often use lines of code to measure their size, or they keep track of how long it takes to develop them. From there, a company can track how quickly customers adopt newly added features and even calculate the number of users for a given feature, expressed as a percentage of the product’s overall users.
### Measuring decline
Companies may find that churn rate is still worth watching at the decline stage, but a crucial measure is what the product costs against what it still earns. A company can track monthly recurring revenue from subscriptions and contracts, as well as expected annual revenue from existing customers, to get this metric.
## Learn more about product life cycles
Want to learn more about how product life cycles work or other aspects of business? University of Phoenix, an accredited, online university for working adults, offers[online business degree programs](https://www.phoenix.edu/online-business-degrees.html), such as the[Bachelor of Science in Business](https://www.phoenix.edu/online-business-degrees/business-bachelors-degree.html#certificates)with a Marketing Certificate and the[Undergraduate Marketing Certificate](https://www.phoenix.edu/online-business-certificates/marketing.html).
To[request information](https://www.phoenix.edu/request/request-information)about these online degrees, reach out to the University.
Read more articles like this:
[What Is Social Media Marketing? May 31, 2023 • 7 minute read](/articles/marketing/what-is-social-media-marketing)[How to Become a Marketing Coordinator Online Degrees March 23, 2023 • 6 minutes](/articles/marketing/how-to-become-a-marketing-coordinator)[What is Digital Media? Online Degrees February 16, 2022 • 9 Minutes](/articles/marketing/what-is-digital-media)
### ABOUT THE AUTHOR
Dillon Price is a detail-oriented writer with a background in legal and career-focused content. He has written and edited blogs for dozens of law firms, as well as Law.com. Additionally, he wrote numerous career advice articles for Monster.com during the company’s recent rebranding. Dillon lives in Western Massachusetts and stays in Portugal each summer with his family.
### ABOUT THE REVIEWER
Currently Dean of the College of Business and Information Technology, Kathryn Uhles has served University of Phoenix in a variety of roles since 2006. Prior to joining University of Phoenix, Kathryn taught fifth grade to underprivileged youth in Phoenix.
This article has been vetted by University of Phoenix's editorial advisory committee.
[Read more about our editorial process.](/blog/editorial-process.html)
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