Text 3 Product and Price

To the consumer, a product is something for sale and price is the cost of this item. A company must anticipate consumer needs and wants in order to develop suitable products and support these products with quality control, packaging, distribution, and pricing.

The product consists of goods, services, or ideas that may be either tangible or intangible. The total product concept describes a product as a ”bundle of satisfactions” or want-satisfying attributes that may have physical, psychological, and/or sociological impacts.

The fact that most products go through stages similar to the life cycle of human beings is useful in forecasting and developing marketing strategies. The stages of the product life cycle result from decisions made by the company and such external forces as competition and environmental change.

During the introduction stage, promotion is needed to familiarize the consumer with a new or redesigned product. During the growth stage, the new product becomes accepted and sales increase. In maturity stage, sales peak and begin to level off as replacement sales become more important. All products eventually reach the decline stage and experience decreasing sales either because the product has become outdated or because of changes in market demand. Marketing managers must predict a product’s life cycle and plan their marketing activities so as to get the most sales out of each stage.

Branding is a means of identifying a product and/or a producer. Branding provides physical product identification, legal protection under patent and trademark laws, and a product image around which a marketing campaign can be built.

Pricing decisions are among the most important challenges facing marketers today. Pricing decisions include start-up pricing, price modification, competitive pricing, and interrelated product (line) pricing. Some of the more common goals of pricing include increased sales or market share goals, status quo pricing, increased return on investment (ROI), or profit maximization.

6. Ответьте на вопросы:

1) What does a product consist of?

2) What stages of the product life cycle do you know?

3) Pricing decisions include only price modification, don’t they?

7. Дайте на английском языке развернутое определение понятиям:

a product –

branding –

a product life cycle –

8. Закончите предложения, произведя нужный выбор:

1) During the introduction stage	a) the new product becomes accepted and sales increase.
2) During the growth stage	b) the marketing manager must choose between eliminating the product or improving it.
3) In the maturity stage	c) promotion is needed to familiarize the consumer with a new product.
4) In the decline stage	d) sales peak and begin to level off.

9. Ваше предприятие выпускает офисную мебель (office furniture), которая пользуется спросом на рынке. Расскажите на английском языке о том, как вам удалось добиться этого.