Terms

• Market mix – four marketing decisions needed for the effective

  marketing of a product
• Four Ps – right product at the right price with the right

  promotion in the right place
• Product – the goods and services produced to satisfy a

  customer’s needs or wants
• Price – what the business is going to charge customers who want

  to buy the product
• Brand – the name or symbol given by a business to its product

  from those of its competitors. It distinguishes a product from

  competitors’ products
• Brand image – the general impression of a product held by

  consumers. Creating a brand image increases sales.
• Introduction stage – product is introduced to the market. Sales are low. Product might be making a loss in this stage because of the cost of heavy advertising to gain product recognition.
• Growth stage – product is becoming better known to consumers. Sales are increasing. The product usually starts to earn profit.
• Maturity stage – sales are no longer growing but are not falling. This is the most profitable stage.
• Decline stage – sales are falling. Product eventually becomes unprofitable and is withdrawn from the market.
• Extension strategies – marketing activities to extend the maturity stage of a product
• Product quality – the product meets the needs and expectations of customers
• Price – the amount paid by the customer when buying a good or service
• Market Skimming – setting a high price for a new product that is unique and very different from any other product on the market
• Penetration pricing – setting a low price to attract customers to buy a new product
• Competitive pricing – setting a price similar to that of competitors’ products which are already established in the market
• Cost-Plus pricing – setting price by adding a fixed amount to the cost of making or buying the product
• Mark-up pricing – is a pricing strategy that involves taking the cost of a product and adding a certain percentage on top of it to set the final selling price for a product.
• Full-cost pricing – is a pricing strategy where the price of a product is calculated by a firm on the basis of its direct costs per unit of output plus a markup to cover overhead costs and profits