The product life cycle theory in marketing management separates into four stages introduction stage, growth stage, maturity stage and decline stage. In certain cases where the sales volume is being controlled introduction and growth stages become united. Certain products which is penetrated rapidly in the market are facing threats due to international competition from similar product introduced during the growth stage.
When a new product is launched in the market for the first time there will be huge demand for it because of the low availability. At this stage more people will be buying products and sales will be showing increase. Once the demand for the product is met the sales will become lower which will sometimes show a downward trend. As far as international marketing is concerned, imitations of products usually with low cost gets introduced in the market and the decline will be accelerated.
The most important thing for a product to grow in the market is the need for the product. Before the product is introduced in the market detailed analysis might have been conducted about the size of the market and the consumption rate. So when the product is introduced naturally the need get fulfilled by the sales of the product. So the high price and higher sales will yield more profits. And in such cases, there will not be much competition from low budget customers.
In the next stage when the sales volume lowers international suppliers usually lowers the price in order to maintain the sales rate. The money which put in development and promotion can also be used in maintaining the margin as the product is already popular in the market. When the original supplier reduces the rates it will become difficult for the imitated product to sustain.