The product life cycle.

First, the product is developed according to the needs of the market. When it is ready, it is launched onto the market. At first only small numbers of consumers buy the product, but as it becomes known, more and more follow. At this stage the company invests a lot of money in advertising and promotion. Sales rapidly grow and the product reaches its mature stage of development. At this stage sales start to level off until they move into decline. Companies sometimes try to arrest the decline by re-investing in advertising or by finding new applications for the product. But it is inevitable that most products die.

The second P - place refers to the target market for the product. The modern business, besides a good knowledge of what is the customer requires, must also have a good idea of the customer type that the product will be aimed at. The total market with a certain type of customer is known as a segment. The use of the term place in no way implies that the business will sell its product in a particular physical location. The potential market is segmented according to such factors as age, sex, family income, type of residence, education, as well as way of life and personality traits. Many products are aimed at a certain age group, e.g. toys are obviously aimed at children. Possible examples of sex segmented products are clothes, shavers, hygiene products, jewelry, and magazines. Such products as cars, food, household items are often segmented by the stage of the family life cycle.

The family life cycle identifies potential consumers by age, marital status, number and age of children as well as differences in their attitudes and habits. The four main stages of the family life cycle are.

The third P is price. The price set for the product will depend on several considerations. As the company has many costs dealing with making, distributing and selling a product, the recovery of these costs compose the primary level of price. In addition, the organization will also charge a price in excess of the costs of the product. Price also has other additional purposes. Among the most significant is that price gives a signal as to the quality of the product and will consequently attract the buyers. "High class" restaurants attract customers simply by being expensive. The "cash only" supermarkets have low prices due to their cost structure, but the low prices also serve to attract their target market.

The simplest pricing model is cost plus. This is when the accountant will calculate the total cost of the product, including its production, transporting and overheads, and then add on a profit figure. The disadvantage of this approach is that it ignores market conditions and the company will either under- or overprice its products.

C o m m e n t s

marketing mix -	фактори ринку
distribution -	рух товарів від виробника до кінцевого споживача
(sales) promotion -	стимулювання збуту
marketer -	маркетолог
to launch a product onto the market -	виходити з товаром на ринок
consumer goods -	товари повсякденного попиту
durables -	кінцевий покупець
final user, end-user -	товари тривалого користування
hi-fi -	високоякісний
to process -	піддавати процесові (технологічному); обробляти
spare -	запчастина
accessories [ak'sesanz] -	арматура, устаткування
installation -	агрегат, пристрій, механізм
patently -	очевидно
product life cycle -	життєвий цикл товару
introduction stage -	стадія впровадження
mature stage -	стадія зрілості (стабілізації)
to level off -	зменшуватися
decline stage -	стадія упадка
in excess of -	вище, ніж
overheads -	накладні витрати