If you are looking for a good example of how the Product Life Cycle (PLC) works, then check out this story from USA Today. The focus is on the craft beer market, and all signs in this market suggest it is following the classic PLC model.
As an industry, we should actually view this as a second coming. As the story notes, craft breweries have been around for hundreds of years and in the U.S. had topped over 2,000 way back in the 1880s. Of course, Prohibition changed that, and it was not until the 1990s that we see what we now refer to as the craft beer market truly starts to grow.
As we note in our PLC tutorial, market growth will always attract competitors and that is clearly the case now with over 2,500 breweries currently operating.
But as PLC theory also teaches us, this market cannot continue to grow. A shakeout is on the way. When that will happen is anyone’s guess, though it is reasonable to assume that 10 years from now the U.S. will likely have far less than 2,500 craft breweries.
Image by AbsolutSara