Product Post #2: VHS and product life cycle

An article on cnn.com today revealed that Wal-Mart will soon stop carrying VHS in its stores. The plan is to phase out VHS by 2006 in order to make room for DVDs. Wal-Mart is not the first retailer to make this decision, Best Buy and Circuit City have already stopped carrying VHS and Target will follow suit by this September.

As a product, VHS had been the standard for years. With the advent of DVDs and their increasing popularity, demand for VHS has declined. This relates to the topic of product life cycles that is discussed in our textbook (p328 - 336). Product life cycle (PLC) is defined as "the course of a product's sales and profits over its lifetime. It involves five distinct stages: product development, introduction, growth, maturity, and decline" (Kotler 330). For many years, VHS was the standard, or the fashion. The book defines a fashion as "a currently accepted or popular style in a given field" (331). In the 1990s DVDs were introduced on a large scale and quickly gained popularity. Since then, VHS has entered a decline stage - "the product life-cycle stage in which a product's sales decline" (335). The decline stage can be brought on by technological advances, shifts in consumer tastes, and increased competition(335); in the case of VHS, DVDs caused all three of these things to occur. Clearly, the decision of many retailers to discontinue stocking and selling VHS is a clear indication that the product is in the very last stage of its life-cycle and is on its way to becoming obsolete.