Product Innovation Cycle Retracement


We have noticed that any type of product gravitate to a pattern known as Cycle Retracement. What is Retracement? In Financial terminology, it means a temporary reversal to the direction of the stock’s price that goes against the prevailing trend. Retracement seems to apply very well into the Product Cycle.

For a new ingenious product, it comes with some attractive features. After the product is revealed to the market, competitors start to get involved. They create similar product, probably with a few new features added. Then, another competitor comes on board and adds a few more features–and this cycle goes on and on. According to the Law of Diminishing Return, at some point of time, the product will come to an inertia stage, a stage of stagnation where competitors have run out of new ideas or there’s no new feature left to be added to the existing product.


At this stage two possible outcomes may arise:

1.)  A Disruptive Product emerges

–       A solution/product, which replaces the current product

2.)  A Breakthrough Product emerges

–       A product that work differently in a better way


Disruptive product is illusive, so in this article, we will focus on the Breakthrough solution. Based on our observation, the trend is – many successful Breakthrough solutions/products that we have seen, has become less complex. These products evolve from more complex and feature-rich products into a much improved and compact version. See the diagram below.

Figure 1.


The gist of this article is to explain how a product/solution grows bigger, richer in features and complexity by the market force. When it reaches a pinnacle point, the product would stay inertia. Then, the trend is, to simplify the current complex into a simpler version, which will perform the similar functions but in an altogether different way. This is a form of Retracement in Product Cycle. See the diagram below.


Figure 2.


In other words, you do not need to keep finding new ways to create new features for your current product. All you need to do is, to simplify your current product – SIMPLICITY is the key.

Go scavenge from your current stagnant products, or look at some products in the market, to see which are the complex products you can simplify. You may use this approach to create and commercialize a new innovative product.

Again, the evolution continues. Competitors will start to add on more and more features from this simplified product. And the whole product cycle continues from here again.