Question

IPOD is an example of a product in the decline phase of the product life cycle. The device was first launched in 2001, and was officially withdrawn from manufacture in mid-2017. It started off as a revolutionary product, making it possible for music to be stored in one small easy to transport location. New versions have been released over the years, but now the ipod is fading into history. Only the ipod touch model is still widely available, however the classic ipod has been replaced by iphones.

Outline what pricing strategies would have been implemented during each phase of the ipod's product life cycle.

Answer 1

Answer :

A product life cycle is the cycle that a product goes through, from development to decline. It's typically broken up into six stages. Business owners and marketers use the product life cycle to make important decisions and strategies on advertising budgets, product prices, and packaging.

Stages of a Product Life Cycle

1. Development
2. Introduction
3. Growth
4. Maturity
5. Saturation
6. Decline

After its release, the iPod forever changed the way we look at mp3 players. Initially hitting the market in 2001, it became the most popular and recognizable portable music device. This can be attributed to it’s success in the introduction phase. The distinctive click wheel and white head phones that gave the iPod its iconic look and popular product design. They spent a lot on advertisement and saw minimal profit. Practically everyone had some kind of iPod growing up, and Apple was constantly renovating and improving it.

In 2001, when it was first introduced, they sold a total of 125,00 units. By 2006, they were up to 88 million iPods sold. This was when iPod really entered the growth stage. The product design began to stabilize and they continued to enhance and upgrade its ability and capacity. This was also when Apple really started to heavily advertise. The white headphones continued to be a stable of the iPod and Apple capitalized on this with advertising. This also allowed them to have customers advertise for them. Anytime you saw someone using white headphones, you knew it was an iPod without even seeing the iPod. The fact that they could have successful advertising without even showing the device was an amazing accomplishment.

Sales peaked in 2008, and at this point they sold over 157 million iPods. This signified the beginning of the maturity stage as sales started to slow down and stabilize. Competitors were established and ultimately realized they had little chance of competing with the iPod. Apple was also able to reduce cost and improve production. By 2010, 275 million iPods were sold. Most customers at this point are repeat buyers and want to upgrade their previous device.

In 2014, almost 13 years and 26 models later, the iPod seems like it has finally reached the end of it’s product life cycle, and is seeing the effects of the decline stage. Profits for the year are down 52% compared to this time last year, and is expected to drop even further. On top of this Apple has greatly reduced the amount of time and money spent on enhancing and advertising. The newest iPod release was the 5th generation iPod touch, and that was in May of 2013. In 2014 they released colors for the 5th generation, but it has been over a year since the last iPod model was released, and this is the longest gap in the devices history.

Reasons for this are believed to be a result of consumers expecting more from their devices. Instead of buying a iPods, Apple consumers are buying iPhones and iPads instead.

Steve Jobs joked in 2007 when the iPhone was released that the iPhone was “the best iPod we’ve ever made”. I wonder if he realized how correct he was, or that the iPhone would eventually replace the iPod all together. iPhones and iPads offer the same music capabilities of the iPod, but with much more ability, including thousands of mobile apps, accessible internet, and many ways to connect and communicate.