Assignment submission of a summer internship program on marketing

1. Developing Pricing strategies and
programs : Part 4

2. The only element of the marketing mix that produces revenue!
The other elements
produce costs.
It is also the
easiest to adjust!

3. Internet especially
has had a profound
impact on buyers
and sellers!
Changing pricing environment:
Easy access to credit,
enticing market campaigns,
progressive technology

4. Buyers can
Get instant price comparisons from a slew of vendors
Name their price and have it met (Priceline.com)
Get free products (eg: free software products)

5. Monitor customer behaviour and
tailor offers accordingly
Give certain customers access to
special prices
Negotiate prices in online auctions
and in person
Sellers can

6. Developing appropriate
pricing strategies and
programs is
extremely important!!

7. When should a
company initiate a
price change?

8. Increase
Prices
2 choices
Decrease
Prices

9. Cost inflation
Increase in demand
When?

10. 1) Delayed quotation pricing:
Final price is not set until the product
is finished or delivered.
How?

11. How?
2) Escalator clauses
Buyer has to pay
today’s price and
unforeseen inflation
increases that take
place before delivery.
Price increase is based
on a price index

12. How?
3) Unbundling
Company maintains its
price but removes or
prices separately one or
more elements that
were earlier a part of
the price. Eg: delivery
charges.

13. How?
4) Reduction of discounts

14. When?
Excess Plant capacity
Drive to dominate market
through lower costs

15. Disadvantages
1) Buyers assume quality is low
2) May buy market share but not
market loyalty
3) Price war from competitors

16. Recap:
Price changes
1) Price increase -> When?
2) Price decrease -> When?

17. Thank You!