Extending the product life-cycle by selling in multiple markets - 4.2.1

Product lifecycle - An important concept in marketing. It describes the stages a product goes through from when it was first thought of until it finally is removed from the market. Not all products reach this final stage. Some continue to grow and others rise and fall.

One of the main reasons for operating in a global market is to extend the lifecycle of a product. According to the product lifecycle, a product will peak in its maturity stage and then start to decline, resulting in less profit. An extension strategy used by businesses is to introduce the product to a more international market/less mature or saturated market, effectively extending the life of the product. This might require adapting the product to suit local tastes or a large promotional budget to raise awareness. However, if successful, this might extend the life of the product for a number of years.

Advantages of selling products in multiple markers include;

• Continued profitable returns
• Potential economies of scale due to selling large numbers of the product
• Potential to develop a new and loyal customer base for current and future products

Disadvantages of selling products in multiple markets include;

• General risks of operating in new markets such as language barriers 
• Increased costs due to exporting the product 
• The expense of marketing campaigns to raise awareness of the product among new customers
• Products may need to be adapted to the local market meaning increased costs from further product development.