Product life cycle: deciding on investment and development

1. Define the product and review scope

Specify what you are analysing: a product, a range, a service or a combined offering. A range may grow while one of its products loses appeal. An overly broad analysis conceals necessary choices.

Define the period, channels and segments involved. A mature product in one market may be new to another audience. A large one-off sale may also distort the trend. Record these elements before drawing a curve.

Gather sales, margin, availability, complaint and usage data. Distinguish observed data from estimates. If information is incomplete, start by filling gaps rather than producing an artificially precise classification.

The review should address a decision: fund a development, expand a channel or scale back a product. A phase label has value only if it improves this decision.

2. Interpret stages without turning them into a forecast

Launch calls for checking understanding of the need and actual use. Growth raises questions of capacity and repeatability. Maturity invites examination of contribution, new expectations and differentiation. A sustained decline calls for analysis of causes and options.

These situations can overlap. A development sometimes revives demand; a channel change can shift the problem. Do not impose four regular phases on observations that do not show them.

The model facilitates discussion but predicts neither duration nor sales levels. The decision must retain its conditions and uncertainties.

3. Distinguish the causes of a sales change

Before changing the product, check availability, visibility and how the purchasing journey works. Repeated stockouts or a less active distributor may explain a decline without a change in need.

Then examine price, alternatives and usage feedback. Customers may like the product but find a purchase condition unsuitable. Their needs may also have changed. These causes lead to different actions.

Ask people who buy, those who decide against buying and service contacts. An isolated view does not represent the entire market, but can point to an assumption worth checking. Document the question and seek further observations.

The growth strategy connects this information to priorities. Do not reduce the analysis to the idea that an ageing product needs more advertising.

4. Examine contribution and investment needs

Compare sales with variable costs, support expenses and resources tied up. A low-selling product may consume considerable stock or work. A high-selling product may contribute little after discounts and service.

Define a calculation basis consistent with your management accounting. Examine assumptions with financial managers. A margin estimate excluding significant service costs can steer the portfolio in the wrong direction.

For every investment, describe the problem, cost, timeframe and expected effect. Technical improvements, distribution expansion and communication do not test the same assumption. Prepare several scenarios and their conditions.

The management indicators presented by Bpifrance provide general guidance. Using them does not remove the need to adapt calculations to your activity and the data actually available.

5. Choose a test before rolling out

A limited test may cover a version, channel or segment. Define the change, audience and observation period. Avoid changing product, price and communication simultaneously if you want to understand each element’s contribution.

Set a success criterion and a stopping criterion. A first order informs initial adoption; usage and repurchasing inform relevance over time. The review timeframe must be compatible with this rhythm.

Record external conditions: stockouts, a competitor promotion or a capacity change. An observed change does not automatically demonstrate that the modification caused the result.

Also prepare what follows the test: resources for expansion, training needs, data to maintain and resources to withdraw. A decision to continue must be feasible, not just favourable in a spreadsheet.

6. Fictional example: a stable range and a vulnerable product

Fictional example. A business distributes three equipment models. The range remains stable, but one model declines. The owner considers an overall campaign. The review shows that this model suffers stockouts and requires longer assistance.

The business distinguishes two assumptions: insufficient availability and difficulty in use. It first restores order tracking and gathers feedback on installation stages. It keeps other conditions unchanged so observations can be interpreted.

A preparation guide is then tested with a limited group of orders. The review examines usage, assistance time and contribution. No growth figure is assumed.

Depending on observations, the decision may be improved documentation, a technical modification or gradual withdrawal. The life cycle model does not prescribe which; it organises the questions that allow a choice.

7. Prepare transitions and answer common questions

A change or withdrawal affects stock, commitments, service and customer information. List consequences before deciding. Define who informs contacts and how requests involving the old version will be handled.

Maintain a periodic portfolio review with assumptions, decisions and dates. Do not confuse regular review with permanent change. Useful stability can be a deliberate choice when it serves customers and the offering’s economics.

The life cycle optimisation advisory service helps connect the portfolio, processes and investment priorities.

Does every product go through the same stages?

The model aids interpretation. Actual trajectories can vary and phases are not always clearly separated.

Does a decline mean the product should be withdrawn?

First examine the cause, contribution and options. Withdrawal is one decision among several.

When should we invest in a new version?

When you can explain the need, the modification and the criteria for examining its value.