Final answer:
The growth stage of the product life cycle is characterized by a rapid increase in sales and increasing competition, which leads to higher profits although they might stabilize or decrease slightly due to competition.
Step-by-step explanation:
During this phase, products typically experience a surge in sales as they gain acceptance in the market. Simultaneously, the success of the product attracts more competitors who want to capitalize on the emerging market opportunity. This leads to an increase in the number of similar products available, pushing companies to differentiate through marketing strategies and product improvements.
Marketers might also focus on stimulating secondary demand, which involves convincing consumers to choose their specific brand over others, rather than primary demand, which is the overall demand for the type of product itself. While profits rise due to increased sales volume, they might eventually stabilize or fall slightly due to heightened competition and the resulting pressure on prices. However, profits do not typically decline in the growth stage as strongly as they might in later stages, such as maturity or decline.