Discuss any two important characteristics of product life cycle when the product is introduced in the market.

Two important characteristics of product life cycle when the product is introduced in the market (Introduction Stage):

1. High costs and low sales volume — During this stage, prices are usually high because of small scale of production and heavy promotional expenditure. Sales grow at a low rate due to lack of consumer awareness and limited distribution. As a result, profits are typically negative.
2. Limited competition and risky stage — Competition is virtually absent as the product is new and imitation has not yet taken effect. However, this stage is very risky because a high percentage of new products fail during this period due to consumer resistance and high costs.