PACKAGING The aim of packaging isidentification, containment, protection, safety and to attract customers.
Labels Part of the package Promote the brand name Give information on the contents Where it is made (important for some) www.coca-cola.com.au livepositively link
Product life cycle – in packaging Introduction – developed for sale Growth – Product begins to become popular Maturity – Product popular Decline – Product becomes outdated Packaging changes can be made at each stage to keep the consumer interested See figure page 181
Price Price is either fixed or flexible When pricing a product the business must take into consideration. • What the customer is willing to pay • Manufacturing or production costs
Price Customer orientation • Sometimes people like to pay for quality • “Pay for what you get” • Product thus needs to be promoted to show difference from others • Prices is more expensive
Production Orientation Takes all the fixed costs and the variable costs to form overall costs. • MARKUP % • All the costs + the % profit = Price • To make a profit • BREAKEVEN • All the fixed costs + the desired Profit / selling price – variable costs • To not make money but get the product out there
Approaches to pricing Price Skimming • Aim at the top end of the market first then reduce later so becomes more affordable • Aimed at the top end of sciety Penetration Pricing • Low cost to gain entry then increase over time to get more share of the market Competitive Pricing • Match the competition. Usually arises in the maturity stage Price Reduction • Discounts are given ie. Bulk purchase or dockets Demand Pricing • Find out what people are willing to pay and go with that
Paragraph Response Summarize the different methods of pricing in a paragraph. Give examples for each method of pricing to support your answer.