Biz Tips: Understanding Lifecycle Marketing

Biz Tips: Understanding Lifecycle Marketing

GROWTH:

Understanding Lifecycle Marketing

First, we are born. Then we grow, develop, mature and in the end, we die. This is the cycle of life. Just like people, businesses go through specific stages of development on their way to success.

There are four basic phases: introduction, growth, maturity and decline.

Introduction

The introduction stage includes pre-launch and introduction to the market, where your brand or product is still unknown and you have to fight for the right to be established in the market. You market is still small, sales are low and the audience mainly consists of early adopters. So what is the main focus during the start-up phase of the business cycle?

The answer is rather simple — to raise awareness, which will in its turn create the trust in the brand and recognition for you as an expert. Would you buy a product or a service of a completely unknown company? Probably not, especially if you have an alternative to a well-known brand. People tend to stick to the companies that they know and that they trust, that´s why when you just enter the market it is crucial to make people learn about you and remember your name. Knowledge equals trust!

Growth

With time people learn about your brand and start paying attention to your business, then the growth phase of the business lifecycle begins. The growth phase consists of rapid growth and stabilizing which leads to the maturity phase after. Your market is growing, the product or service becoming well-known or even mainstream and the number of sales is growing fast especially comparing to the start-up phase.

The growth is still usually characterised with rather low profit (but hey, there is profit already, the start-up phase usually can´t offer that!) while the costs are still high. Why so? The main focus of the growth time is to win the market share. You have established your name — now you have to scale up and that requires investment, but now when people think about a certain product or service — they think about you!

Maturity

Which leads us to the maturity phase which is the flat part of the curve identified by the constant amount of sales, reduction in costs and the continually increasing profits. The main focus for marketing during this stage is maintaining the customer relationships and retaining clients.

If maintained properly the maturity phase for businesses can last for years given there is demand for the products or services it´s providing. The innovation is a good solution to the update and introduction of the new options that would increase customer interest and loyalty to the company, but if the company ignores the signs of decline such as a drop in sales, increasing costs and market share loss it will inevitably cease to exist.

Decline

Business is a dynamic process and it should be adjusting to the financial environment, customer needs, market trends to be able to maintain its existence and be profitable.

When the business comes to decline it can go two ways — continue to decline and cease to exist or innovate and go into the completely new business lifecycle. Decline doesn’t always mean the end, as the product can be updated and changed, new markets can be discovered, etc. The promotion during the decline stage usually helps the business transition to either outcome.

Understanding the stages of business development helps you to adapt your marketing strategy goals to what is most needed at that moment in order to help your business grow with easy and be successful. It is not a difficult science, just think about the natural order of things. A baby doesn’t run before it learns to walk. As it is said, a stitch in a time saves nine.

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