From Birth to Death
Your product dies. With the same inevitability with which we humans approach death more and more, every software application moves into the future.
The difference is that we are becoming more and more competent to care for each other and each other, so our chances of a longer and more fulfilling life grow larger over time. We have learned to recognize our own and others’ positions in the life cycle, and to realize that we have the means and the ability to provide the care and environment necessary for our continued survival and prosperity. We nurture and care for our young children and accept and encourage their ability to stand on their own two feet as part of their journey to the day when they are fully self-reliant. In due course they will take care of us when we grow old, and once again they will be supported by their own children.
And so on to the software. The life cycle of a product does not differ significantly from our own. Despite our ability to respond to changing needs, many of us are unaware of the needs of our products and software over time. The concept of the product lifecycle is simple and allows you to see where your product is at any time and to assess the circumstances ahead by providing the information you need to respond appropriately. Just as we are not waiting for the teenage years of a child before we start training, or for making an elderly person so frail that he is unable to take care of himself, we should not focus on the negative points In a product life cycle, waiting to be so obvious that it is too late to respond effectively.
The product life cycle consists of four phases, each with its own identifiable symptoms, threats and opportunities, all of which should be addressed individually.
The early days
First, the introductory phase. When a new product is launched, the initial impact is usually very small, and identifying new patterns is often nearly impossible. You will probably only come on the market with the least amount of waves, let alone a shot. There are exceptions to this. Big advertising budgets, hype, public interest before product launch and new technologies can increase the initial visibility of the product launch. But even a high-visibility campaign will take some time to tell customers that a product is available and time to generate and see significant demand. For most of us it is unlikely that a profit can be made at this stage, even if the marketing budget is very high, and the possibility of an actual short-term loss is very real.
How long should this phase last? It is almost impossible to estimate the answer with a degree of accuracy, since there are so many variables. So much depends on the market demand for the software, the marketing budget, the visibility, and so on. The basic strategy at this stage is simply to “put the product on the market” and focus as much attention as possible.
The next step in the product lifecycle is the growth phase. If everything goes according to plan, this phase should be easy to see in terms of both revenue and profit. The risk, however, is that many companies simply sit back and enjoy the ride and the success. Absolutely not! The growth cycle is the time to aggressively search for new opportunities and gain as much market share as possible. Some pretty clear patterns should appear fairly quickly at this point, and it’s usually obvious what works and what wastes your time. Pay attention to three factors. The “successful” factors need to be investigated and improved. If you are enthusiastically received by a journal editor, you can take advantage of this by actively seeking more journals, more editors, and more exciting posts!
The “intermediate” factors are a little less obvious. Results in this category are usually consistent and uninspiring, but may have room for improvement – only if you recognize them. For example, if one or two search engines have significant traffic, they must actively search for what you are selling. So get into the search engines and invest some time in improving your position.
And finally, the “on the way out” factor, which is the easiest to recognize and the easiest to ignore. You may want to continually tweak and improve your website. However, when you reach a certain point, the time required to do so outweighs the actual results. Anything you do that time with nothing or little shows consumed should be avoided. Go on.
The mature product
The next point in the lifecycle of the product is the maturity phase. The euphoria in the growth phase slows to a calmer and quieter pace, which often offers a wealth of opportunities and can also pose some potential threats. Your competition is likely to be the strongest at this stage, and the level and success of your marketing will almost certainly be a critical factor in the success of your product. The stage of maturity is very similar to human adulthood. Massive growth is unlikely and as long as we accept our age and take care of ourselves, we can look forward to a long and healthy future, both for ourselves and for our products.
Increasing market share over the term is possible, but it is unlikely to prove to be very cost effective. At present, it is more likely than ever that the product will be affected by market trends. Assuming that demand remains healthy, marketing, promotion, advertising, and visibility are paramount to sustaining demand rather than increasing it. New packaging can help to rejuvenate a product in the mature phase, as well as new sales methods or aggressive competition with the product’s properties or price.
The happy pensioner
Finally the phase of rejection in the product life cycle. The human golden years are not the agony. Just as most pensioners enjoy many long and happy graduation years, so can your product! Around this time, a common mistake is to misinterpret short-term fluctuations and interpret them as beginning of the acceptance phase. Although the product life cycle is theoretically a smooth and fairly elegant curve, in reality there are constant fluctuations due to any number of external factors. The following diagram shows the point and shows a realistic model compared to the theoretical one.
The rejection phase does not mean that it is time to give up your product altogether, but that new and appropriate strategies may be appropriate. For software, this may mean that new versions and features, adjustments to newer operating systems and hardware, price reductions, etc., are required to extend the life of the product.
Try applying the concept of the Product Life Cycle model to your application. You should be able to implement some new options and strategies as soon as you have identified the current phase in the life cycle of your product and in the market itself. Although the Product Life Cycle concept is useful, it is equally important to consider the external factors, especially in response to the rejection phase. My own favorite consideration of these external factors is the PEST analysis. Political, economic, social and technological. Include all of this information before applying lifecycle strategies.
By applying the product lifecycle to your application, you can take a step back into your organization’s day-to-day life, objectively seeing where you are, and the opportunities and risks that come with it. You can use the information that this technique gives you to make sure your marketing efforts are not wrong, inappropriate and ineffective. As Sinatra said – It was a very good year. Do it right. Be seen, sold.