The document discusses various factors that affect pricing such as costs, supply and demand, competition, and regulations. It also covers pricing objectives like return on marketing investment. Different pricing techniques are outlined like psychological pricing, discount pricing, cash discounts, promotional pricing, quantity discounts, prestige pricing, and seasonal discounts. Methods for calculating prices like list price, market price, MSRP, and unit pricing are also defined.

1. The Price Strategy
Chapter 11

2. Factors Affecting Price
• Costs and Expenses
• Supply and Demand
• Consumer Perceptions
• Competition
• Government Regulations
• Technological Trends

3. Pricing Objectives
• Goals that tell what a marketer wants to
achieve through pricing.

4. Return on Marketing
Investment (ROMI)
• Ratio that tells a business how much it earned
as a percentage of the investment it made to
earn the money.

5. Price-Fixing
• Situation in which a group of competitors gets
together and sets (fixes) the price for a
specific product; they then all agree to sell
that product for the same price.

6. Price Discrimination
• Situation in which a company plays favorites
by charging lower prices to some companies
for the same products.

7. Price Channels
Retailer
Manufacturer Wholesaler Consumer

8. Pricing Techniques

9. Psychological Pricing
• Set of pricing techniques used to create an
image of a product to entice customers to buy.

10. Discount Pricing
• Business that sell to other businesses often
use discount pricing.
• Discount pricing offers a reduction from the
regular or list price of a product.

11. Cash Discount
• A reduction in price is offered to retailers who
pay their bills promptly. (B2B)

12. Promotional Pricing
• A discount is given in exchange for the
customers promoting the product. (B2B)

13. Quantity Discount
or Bundle Pricing
• A discount is given for a large order. (B2B)

14. Prestige Pricing
• A technique used in which higher-than-
average prices are used to suggest status and
prestige to the customer.

15. Seasonal Discount
• A discount is given when a retailer buys in
advance of the season. (B2B)

16. Calculating Prices

17. List Price
• Established price of a product as published in
a catalog or on a price tag.

18. Market Price
• Actual price you pay for a product, after any
discounts or coupons are deducted.

19. MSRP
• The retail price that the manufacturer
recommends.

20. Unit Pricing
• Displaying the price of an item based on a
standard unit of measure, such as an ounce or
a pound.