Pricing strategies

1.  How to decide the prices?
 How to change prices with changed channels?
 How to match prices
with quality?
 How to respond to
competition?
 How to price an
improved product?
 How to price in different
Countries?

2. Final product price
Competitor’s
price
Cost
function
Customer’s
demand

3. I Understanding the pricing objective
II Estimating the level of demand
III Costs calculation
IV Analyzing competitors offerings
V Selecting a pricing method
VI Deciding the final price

4. Survival
Maximum current
profit
Maximum market share/
penetration pricing
Maximum market
skimming
Product quality
leadership

5.  Demand forecasting:
Statistical tools
Price experiments
Customer survey
 Elasticity of demand

6.  Fixed cost
 Variable cost
 Average cost

7. Analyze product differences
Analyze cost differences
Analyze price differences
Analyze offering differences

8.  Target return pricing
 Mark up pricing
 Perceived value pricing
 Going rate pricing
 Auction type pricing
 Sealed bid pricing
 Group pricing

9. Psychological
pricing
Gain & risk
share pricing
Effect of other
p’s on price
Company
pricing policy

10. VII Adapting the price
 Geographical pricing
 Discounts
 Promotional pricing
 Discriminatory pricing
 Product mix pricing
 Optional feature pricing
 By-product pricing