How do you segment a market for different product life cycle stages?

1 Introduction stage

The introduction stage is when you launch a new product or service to the market. This stage is characterized by low sales, high costs, and limited awareness and acceptance. The main goal of this stage is to create demand and interest for your product or service and to establish a market position. To segment a market for the introduction stage, you need to identify and target the early adopters, who are the first customers to try and adopt your product or service. Early adopters are usually more innovative, risk-taking, and influential than the rest of the market. They can help you test your product or service, provide feedback, and spread word-of-mouth. To segment the early adopters, you can use criteria such as demographics, psychographics, behavior, or benefits sought.

2 Growth stage

The growth stage is when your product or service gains popularity and acceptance in the market. This stage is characterized by increasing sales, decreasing costs, and growing competition. The main goal of this stage is to maximize market share and profitability and to expand your customer base. To segment a market for the growth stage, you need to identify and target the early majority, who are the next customers to adopt your product or service after the early adopters. Early majority are usually more pragmatic, cautious, and mainstream than the early adopters. They can help you increase your sales volume, reduce your unit costs, and enhance your reputation. To segment the early majority, you can use criteria such as demographics, psychographics, behavior, or benefits sought, but you may also need to consider other factors such as geographic location, distribution channels, or price sensitivity.

3 Maturity stage

The maturity stage is when your product or service reaches its peak in the market. This stage is characterized by stable or declining sales, low costs, and high competition. The main goal of this stage is to maintain market share and profitability and to defend your market position. To segment a market for the maturity stage, you need to identify and target the late majority and the laggards, who are the last customers to adopt your product or service. Late majority and laggards are usually more conservative, skeptical, and price-conscious than the early majority. They can help you sustain your sales revenue, optimize your profit margin, and extend your product life cycle. To segment the late majority and the laggards, you can use criteria such as demographics, psychographics, behavior, or benefits sought, but you may also need to focus on differentiation, loyalty, or retention strategies.

4 Decline stage

The decline stage is when your product or service loses its appeal and relevance in the market. This stage is characterized by decreasing sales, increasing costs, and shrinking market size. The main goal of this stage is to minimize losses and to decide whether to withdraw, reposition, or rejuvenate your product or service. To segment a market for the decline stage, you need to identify and target the remaining customers who still value your product or service. These customers may be loyal, niche, or nostalgic. They can help you recover some of your costs, generate some cash flow, and preserve some of your brand equity. To segment the remaining customers, you can use criteria such as demographics, psychographics, behavior, or benefits sought, but you may also need to adopt cost-cutting, discounting, or bundling tactics.

5 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?