Pricing methods and strategies AYANSH SINGH

1. BUDDHA INSTITUTE OF
PHARMACY
CL-1, Sector-7, GIDA, Gorakhpur, 273209 (U.P.)
INTERNATIONAL CONFERENCE-2023
“RECENTTRENDS IN PHARMACEUTICAL
RESEARCH”
in collaboration with
INTERNATIONAL JOURNAL OF MEDICALAND
PHARMACEUTICAL RESEARCH (IJMPR)
organized by
BUDDHA INSTITUTE OF PHARMACY, GIDA GORAKHPUR, UP,
INDIA
(6-7th April 2023)
Presented By:
AYANSH SINGH

2. PRICING METHODS
AND STRATEGIES

3. PRICING METHOD
• PRICING METHOD OR STRATEGY IS THE
ROUTE TAKEN BY THE FIRM IN FIXING THE
PRICE.
• THE METHOD/STRATEGY MUST BE
APPROPRIATE FOR ACHIEVING THE DESIRED
PRICING OBJECTIVES.

4. TYPES OF PRICING METHODS
1. Cost Based Pricing
A fixed percentage added on top
of production costs for one unit.

5. 2.DEMAND
BASED
PRICING
• THE PRICING DECISION IS ALSO
DEPENDING ON DEMAND AND
SUPPLY OF THE COMMODITY.
• MORE REALISTIC .
TYPES OF DEMAND-BASED
PRICING ARE:
• WHAT THE TRAFFIC CAN BEAR
PRICING
• SKIMMING PRICING
• PENETRATION PRICING

6. “WHAT THE TRAFFIC CAN
BEAR”
• THE SELLER SETS THE MAXIMUM PRICE THE BUYERS ARE WILLING TO PAY IN
GIVEN CIRCUMSTANCES.
• IT WILL BRING A HIGH PROFIT DURING THIS PERIOD.
• CAN BE USED IN THE FOLLOWING CONDITIONS –
SHORTAGE OF GOODS, MONOPOLY , OLIGOPOLY

7. SKIMMING PRICING
• INITIALLY THE PRODUCTS WILL BE INTRODUCED IN A HIGH PRICE AND
SUBSEQUENTLY SETTLE DOWN FOR A LOWER PRICE.
• EXAMPLE: MOBILE PHONES, TELEVISIONS ETC.. MOST OF THE ELECTRONIC
ITEMS.

8. PENETRATION PRICING
• INITIALLY INTRODUCED AT A LOWER PRICE AND INCREASES ITS PRICE AS ITS
DEMAND IN THE MARKET INCREASES.
• GOOD TO CAPTURE NEW MARKET.
• OPPOSITE OF SKIMMING.
• KEEP THE PRODUCT OUT OF COMPETITION FOR LONGER TIME.
• EXAMPLE: DTH SERVICES, MAGAZINES, TV CHANNELS ETC.

9. 3.COMPETITION ORIENTED
PRICING
• COMPETITION BASED PRICING IS A PRICING MODEL WHERE YOUR PRICE POINTS
ARE HEAVILY INFLUENCED BY THOSE OF YOUR COMPETITORS.
• THIS APPROACH FOCUSES OUTWARDLY ON THE MARKET, RATHER THAN
INWARDLY ON THE COSTS.

10. 4.PRODUCT LINE PRICING
• PRODUCT LINE PRICING MEANS OFFERING DIFFERENT VERSIONS OF PRODUCTS
OR SERVICES AT DIFFERENT PRICE POINTS.
• PRODUCT LINE PRICING IS A TOOL THAT BUSINESSES USE TO CREATE THE
PERCEPTION OF DIFFERENT QUALITY LEVELS FOR PRODUCTS IN THE MINDS OF
THE CONSUMERS THEY TARGET.

11. 5.TENDER
PRICING
Industrial products
The customers go by competitive
bidding through sealed tenders.
The seller can only get the best
possible price.
He should thoroughly analyze the
competitors.

12. 6. AFFORDABILITY BASED
PRICING
Essential commodities Social welfare pricing
The idea of this
pricing is to make the
product available to
the targeted population
at an affordable rate.
Items usually
distributed through
public distribution
system.
Subsidies may be
involved
Example: Shampoo ,
medicine etc.

13. 7. DIFFERENTIATED PRICING
Different price for the
same product in
different location.
( Petrol )
The price difference
may also be made in the
case of customer class.
Volume of purchase.
(Offer packs Lux soap,
Colgate value packs etc.)

14. THANK YOU