The product life cycle

Popularised by Theodore Levitt · 1965

Products pass through introduction, growth, maturity and decline, and what to do about one depends entirely on where it is.

Its place in the frameworkMarket Core›Market Opportunities

What it does

Spending to build awareness makes sense in the first stage and is waste in the third; defending share matters in maturity and is money lost in decline. The stage also predicts who else is in the market: growth attracts entrants, maturity produces price competition, and decline leaves whoever can run it cheapest.

Reach for it when: When an opportunity is being judged on its own merits without asking how old the market around it is.
Where it stops: The stages are obvious backwards and hard to identify at the time — a dip can be decline or a pause, and treating it as decline can make it one. Nothing in the model says how long a stage lasts.

Theodore Levitt, “Exploit the Product Life Cycle”, Harvard Business Review, 1965; the concept predates the article.

Why it sits at Market Opportunities

Where demand exists that the organisation is not yet serving — sized honestly, judged on fit as well as attractiveness, and narrowed to a list short enough to act on.

A model is only useful when you reach for it at the right moment. This one answers a question that arises here — so it is filed here, and nowhere else. These are the working areas it serves:

SizingThe addressable-market distinction between total, serviceable and obtainable market, and bottom-up sizing as the check on top-down figures.
Growth and directionDiffusion-of-innovation work on adoption curves, and the industry-lifecycle literature on how attractiveness changes by stage.
Opportunity assessmentAnsoff’s product-market matrix for the fit question, and the market-attractiveness screens used in portfolio planning.
The shortlistStrategic-choice literature on the discipline of deciding what not to do as the substance of a strategy.

All of Market Opportunities

What it touches elsewhere

Nothing in a business is decided on its own. A conclusion reached with this model at Market Opportunities lands in these other cores, whether or not anyone follows it there.

Business CoreAn opportunity requires a value proposition and the capacity to serve it, which is where fit is actually settled.
Goal CoreA pursued opportunity becomes a long term goal or it remains an observation.
CompetitorsAn unserved opportunity is unusual; establishing why nobody is serving it is part of the assessment.
Time CoreWhether the opportunity is available now is a separate question from whether it exists.

Filed at the same place

These answer questions that arise at Market Opportunities too. Where they disagree with this one, the disagreement is the useful part.

PESTEL analysisA checklist of the outside forces a business does not control: political, economic, social, technological, environmental, legal.
SWOT analysisInternal strengths and weaknesses set against external opportunities and threats.
TAM, SAM and SOMThe whole market, the part your model can serve, and the part you could realistically win.

Elsewhere in Market Core

These are other people’s models, named here so you can go to the source and use them properly. The Omnigoal is not affiliated with their authors and is not endorsed by them; nothing of theirs is reproduced here — no canvas, no diagram, no wording. Each is described in our own words, with the originator credited, because the framework is a place to put thinking, not a replacement for the people who did it. Model names and trademarks belong to their respective owners and are used here only to refer to the work itself.

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