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4.5 The four Ps (product, price, promotion, place) (Product (Product life…
4.5 The four Ps (product, price, promotion, place)
Product
Product life cycle
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Stage 2: Introduction
This is the launch stage of the product on to the market. Sales
are low because most consumers are not yet aware of the products existence.
Stage 3: Growth
Once the product is well received by the market, the sales volumes and so revenues start to increase signicantly
Stage 4: Maturity
At this stage sales continue to rise but they do so slowly. The product is well established,with a stable and signicant market share resulting in a positive cash fow.
Stage 5: Saturation
Many competitors have entered the market and saturated it. Sales are at their highest point and begin to all. However, cash flow is still positive
Stage 6: Decline
This stage signifies the steady drop in sales and, through this, the profits of a product. In addition, cash flow begins to fall but is still positive
Extension strategies(an attempt by firms to stop sales from falling by lengthening or extending the products lie cycle)
Sell existing products into new markets. They might sell
products in other regions within a country and/or export them.
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Price
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Penetration pricing
Setting a low initial price or a product with the aim of attracting a
large number of customers quickly and gaining a high market share is known as penetration pricing
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Psychological pricing
Refers to when frms consider how pricing affects
consumers perception of the value of their products
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