Amazon Product Life Cycle

Amazon is best known for the endless supply of various products posted by various sellers. But there is more to it than meets the eye. Every product posted on Amazon has its own life cycle which helps merchants to make proper marketing decisions and develop strategies throughout each of its stages.

We have collected all the important information about the product life cycle that can help your business become better and more visible on Amazon. Once you understand the details, you can plan accordingly and ensure that your product listing process meets Amazon’s expectations.

Why this is important?

Selling on Amazon means doing a significant amount of research to learn about the market, demand, and competition for any products you are interested in selling. This is especially important for brands developing their own products, because the research will show whether it is worth investing time and money.

However, if you stop there, you could be missing out on major opportunities. Understanding your product, its life cycle and the possibility of when it could „die“, will help you position it optimally. You will be able to offer appropriate customer service, set better prices for your products and make better marketing decisions and, as a result, benefit from selling in-demand products.

What is the Amazon product life cycle?

The product life cycle is the series of stages of a product from its ideation up through its withdrawal from the market. Amazon sellers can use this product life cycle as a guide when creating their product listings to make sure they meet customer expectations. The cycle consists of five stages: Development, Launch, Growth, Maturity, and Decline.

Why does Amazon have a product life cycle?

There are several reasons why Amazon has a product life cycle. For example, it is important for the marketplace to make sure that sellers meet customer expectations. That’s why sellers must upload product images and specify details such as the delivery date so the customer knows when to expect their product.

The product life cycle also helps Amazon identify and eliminate some of the unscrupulous sellers making it harder to cheat the system and ensure that customers are protected from fraud.

Adhering to the product life cycle not only helps to keep the entire shopping site looking uniform, but is also beneficial for sellers, as it helps them maintain proper inventory levels.

Product life cycle management (PLM)

In most cases, you can easily determine what stage of the life cycle your product is in. However, different types of products go through their life cycle at different rates. Some products, such as fashion, may be tied to a single season. Others, like smartphones and other consumer electronics, are mostly sold only until the next model comes out, as well as their accessories.

Understanding what stage of the life cycle your product is in will help you make decisions that will benefit your business. You’ll be able to properly manage your next steps to increase sales, reduce costs, and better manage inventory and investments.

PLM: Pricing

Your pricing is directly affected by the life cycle stage of your product.

In the launch phase, sellers must price their products to sell to an audience that is not familiar with it yet. That is, you have to constantly build up the demand for your product not only with help of marketing, but also pricing.

In the growth stage, the price can be defined based on demand and quality. As demand grows, consumers get a bit more picky and begin to look for different types of products in a given niche based on their personal buying preferences.

The most important aspect of pricing in the maturity stage is that the product remains competitively priced within its category.

In the decline stage however, pricing depends on the demand and the competition. When there is little demand, the price should obviously remain low to ensure sell-through. Otherwise, a high price can lead to your share being taken by competitors with a lower one.

PLM: Stock

Maintaining an overview of your products’ life cycles also allows you to take inventory management measures to best meet demand and avoid over- or understocking. This is especially important at the beginning and the end of the life cycle.

In the launch phase, most products can be oriented towards other products within the category. Analyzing the life cycle of similar products can help you predict future demand fairly easily. Products remain in the growth phase as long as they continue to be in high demand and remain popular. Following the life cycle can offer you some security while investing in large amounts of inventory to meet growing demand and be certain that it will help cut costs.

In the maturity stage, inventory management should focus on meeting steady demand and balancing ordering and storage costs. In the decline stage, however, inventory should gradually decrease to account for the inevitable decrease in orders. It is also smart to significantly reduce supply at this stage to avoid taking risks.

PLM: Marketing

In addition to all of the above, the product life cycle also affects demand, customer perception and availability, and therefore your marketing strategy as well. There are several marketing tactics you can use to extend the product life cycle, create new niches and differentiate yourself from the competition.

For example, the launch phase is the time to convince consumers that your product has value. Promotion of the product at this stage should be based on the value it brings to the consumer.

In the growth phase, offering the customer a quality solution that meets or exceeds their expectations is an important step to push the product to the top of its category. Therefore, advertising should focus on displaying the quality and reliability of the product itself, as well as the brand that produces it.

Differentiating the product or seller from the competition through price, quality, packaging, etc. is what will help you stand out in the maturity stage. Various discounts and coupons will stimulate your sales, and innovations such as eco-friendly packaging or a product in a new color or material will help to attract a new audience and excite the existing one.

In the decline stage, it is worth considering the launch of new product versions or moving into new product categories that could extend the life cycle of your product or even bring it back to the beginning.

Marketing tactics should change according to the point in the life cycle, because one that works well for a product in the growth stage may not help it in other stages. If a marketing tactic no longer works for a product, it means that it is outdated, prompting the need to explore new marketing methods as the product progresses through its life.

Curious for more?

We are here to answer your questions or help you solve the challenges you may face anywhere from the launch process to winning tactics that can help your product stand out even in the decline phase.

Alexander Ortner
Principal Amazon Retail
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