During the growth stage of the product lifecycle, available supplies exceed industry demand for the first time.
The correct answer and explanation is :
The correct answer is: “The growth stage.”
In the product lifecycle, there are typically five stages: introduction, growth, maturity, decline, and possible rejuvenation. The growth stage is characterized by an increasing market acceptance of a product, which leads to a rise in sales and demand. During this stage, businesses often start experiencing a noticeable rise in production and distribution to meet market demand.
As the product enters this growth phase, market demand begins to outstrip supply for the first time, leading to increased production to meet the demand. This marks a key shift from the introduction phase, where the supply is generally constrained as companies focus on establishing their product in the market. In the growth phase, companies are more confident in their product’s success and ramp up production, distribution, and marketing efforts to take full advantage of the demand. This is where economies of scale typically begin to reduce costs, and companies often invest heavily in advertising to build brand loyalty and fend off competitors entering the market.
This stage is pivotal because, while supply does begin to exceed industry demand, it also represents the time when the product is starting to gain significant traction and market share. Sales grow rapidly, new competitors may enter the market, and differentiation becomes important. Companies typically focus on refining the product, offering new features, expanding distribution channels, and improving customer service to stay ahead in the competition.
However, during this stage, the oversupply relative to demand can also create challenges, such as market saturation, price pressure, and the need for continuous innovation to maintain growth. If these challenges are not managed properly, the product can plateau and move into the maturity stage, where growth slows and competition intensifies further.