We intuitively understand that products are subject to a life cycle --- they're introduced as innovative and new and eventually become obsolete. Life cycle management applies to marketers, engineers, researchers and managers, because it prescribes different behaviour depending on where a product is in its life cycle. The paradigm has implications for businesses and consumers alike, and product life cycles offer advantages and disadvantages for both parties.
Understanding Marketing and Development
From a marketing and business development perspective, one of the strongest advantages of product life cycles is that they enable a comprehensive understanding of where the products and brands in a company's portfolio currently sit. For example, if a piece of software is reaching the late growth stage of its life cycle, the company recognises that increasing competition will naturally lead to decreasing profits. This means that marketers currently working on the product can be moved to other tasks, and the engineering staff can be reduced to a maintenance level, with other engineers moved to research and development for newer, more profitable products.
Low Applicability in Certain Markets
A disadvantage of the life cycle paradigm is that it's not applicable in all product categories. For instance, established food and drink brands sustain revenues from products that have been in the maturity stage of their life cycles for many years now, but experiments with these core products provoke consumer backlash rather than increased consumption (as a case study, consider "New Coke"). In the pharmaceutical industry, many drugs work as well now as they did 20 years ago. However, trademark expiration and the corresponding uptick in consumption of generics force an artificial life cycle on products, with the industry developing its strategies based on profitability rather than efficacy.
Innovation, Safety and Security
For consumers, the product life cycle has generally positive implications by driving innovation, which leads to products that are more effective and safer --- cleaning products do their jobs better, cameras take better pictures, computers are faster and so on. In computer software, product life cycles also increase security --- unsupported products that are past the end of their life cycles are more vulnerable to viruses or other computer maladies -- by keeping consumers focused on software in the early or developing stages of their life cycle, companies can keep their engineers focused on maximising the security of a small range of products.
The flip side of innovation, however, is a phenomenon known as "planned obsolescence." Because life cycle management effectively demands that products be replaced by new ones, companies build in the terminal stages of the life cycle artificially. For example, a widget manufacturer may introduce a product for the new model year whose plugs are incompatible with the previous year's widgets, or a software company may explicitly decide to stop supporting a product just because it's old. This leads to waste, as consumers are forced to upgrade, discarding products that in all other regards may have worked just fine.