4.5.1—Product

A product moves through introduction, growth, maturity and decline. Its stage affects the marketing mix: launch may need investment and awareness-building, growth may need capacity and distribution, maturity may need differentiation or extension, and decline may require harvesting, repositioning or withdrawal.

A product portfolio spreads risk and cash needs across products at different stages. Introduction often brings negative cash flow and little or no profit because investment and promotion precede sales; growth can improve revenue and profit but still consume cash; mature products may generate cash that funds newer products; decline usually reduces sales and profit unless an extension strategy succeeds.

Evaluate an extension strategy—such as finding a new market, changing features or packaging, or increasing promotion—by its likely extra sales and life-cycle effect against its investment, fit with the brand and risk of only delaying decline.

A mature sports drink introduces a lower-sugar version for a new segment. If the extension uses existing distribution and renews demand, cash generation may continue; if it merely shifts existing customers from the original drink, the portfolio gains little.

The life cycle is a model, not a fixed timetable: stages differ by product and can be affected by competitors, technology and marketing. Do not assume sales, profit and cash flow peak at the same time.