Question

Introduction

ASOS is the UK's market leader in online fashion retailing. It offers own-label, branded fashion and designer goods. Its headquarters are in Camden Town in North London. ASOS originally stood for As Seen on Screen. The company was set up in June 2000 with just two people to bring the latest fashion trends to shoppers as quickly as possible. It has rapidly grown to become the UK's largest independent online fashion retailer. It stocks over 22,000 product styles on its website and introduces up to 1,000 new products to its ranges each week. The ASOS website attracts over five million visitors a month and the company currently has around 1.2 million active customers (that is, people who have bought in the last six months). It was named Online Retailer of the Year in 2008 by Retail Week Awards. ASOS provides high fashion clothing for women, men and children, as well as footwear, accessories, jewellery and beauty products. It aims these primarily at a target audience of 16-34 year olds. However, as the company continues to grow and diversify its product ranges and increase awareness, it appeals to a much wider online fashion market. Over 20% of its current customer database is aged over 35. Each week ASOS delivers 70,000 packages to the homes of its online customers.

ASOS has been able to exploit the increasing popularity of online shopping to help the business grow. According to research from IMRG UK, an organisation which tracks online sales:  around 50% of 16 to 24 year olds buy clothes online more than once a month 30% of women have bought clothes online  the total UK online spend in 2007 was £42.0 million  there were 26 million UK online shoppers in 2007. Online shopping provides customers with the convenience of making purchases whenever and wherever they like. ASOS use of technology helps to increase sales by providing easy navigation around the website and helpful tools like the 'catwalk' option so items can be seen on moving models. The business also benefits from its visionary approach to traditional retailing by not having high street stores. This keeps its staffing and property costs down.As consumers, we buy millions of products every year. These products just like humans have a lifecycle.

Question

Using the above case study explain the four (4) phases of the Product Life Cycle.

Answer 1

Like every human being has a life cycle same as with products. Products also have their lifecycle known as Product Life Cycle(PLC). PLC defines the different phase that a product undergoes with. There is no product that is launched in the market which does not go through the phases of PLC. There are 4 phases of PLC which are as follows:

1. Introduction Stage
2. Growth Stage
3. Maturity Stage
4. Decline Stage

• Introduction Stage: It is the first and the foremost stage of PLC. It defines the initial stage of the product. Introductory stage defines the introduction of the product in the market. It is the stage when the product is about to launch in the market. At this stage the company seeks the target market and product demand in the market. As per the case study this stage can be referred as, when the company was launched in June 2000 by two people with the idea to provide new fashion trend to shoppers as quick as possible.
• Growth Stage: Growth Stage is the second stage of PLC. At this stage the product is now launched in the market. At this stage the company starts using promotional techniques to make the customers aware of the companies product and its usage. In reference to the study the company grew rapidly and became the UK's largest independent online fashion retailer. It stocks are over 22000 that are available on its website as well as introduces 1000 new products every week . It also uses promotional techniques which attracts over 5 million new customers every month and currently it have 1.2 million active customers which make purchases a month.
• Maturity Stage: it is the the third stage of PLC. In this stage the demand for the companies product in the market is at the peak. At this stage the company diversifies its products in the market to stay in the market. At this stage the company gains the highest profits. It also the alerting stage for the company, this is because after this stage the companies product will be less demanded by the customers and sooner and later the companies product will vanish from the market. As per the case study, ASOS, diversified its products from fashion among children. men, and women to footwears, accessories, jewellery and beauty products.However, ASOS continues to grow and diversify its product range, it increases awareness and appeals to a much wider online market.
• Decline Stage: This is the last stage of product life cycle. At this stage the demand for companies products starts declining among its customers and in market. At this stage the companies product completely vanishes from the market and the company also stops the manufacturing of the product. According to the case study ASOS have not reached this stage.