Price
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The document discusses pricing strategies and factors that influence price. It explains that price is determined by costs, desired profit, supply and demand, competition, and customers' perceived value. Various pricing strategies are outlined, including skimming, penetration pricing, competitive pricing, loss leaders, psychological pricing, differential pricing, cost-plus pricing, and strategic pricing. The document also discusses how pricing strategies change over a product's life cycle and can be used to target different quality levels and market segments.
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The document defines sales promotion as short-term incentives to encourage customer buying. It aims to inform, persuade, and remind customers. The objectives of sales promotion are to increase brand awareness, attract new and retain existing customers, maintain seasonal product sales, and meet competition challenges. Promotional techniques include consumer promotions like samples, coupons, premiums, and point-of-purchase displays, as well as trade promotions targeting retailers. Sales promotion affects a product's life cycle and both consumer and trade promotions are important profit-building tools.
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Sales promotion is used to stimulate short-term purchases and build long-term relationships. There are three main types: consumer promotion which uses coupons and samples, trade promotion which offers prices off and free goods, and business/sales promotion like trade shows and sales contests. Developing an effective promotion program requires establishing objectives, choosing appropriate tools, determining the size, conditions, duration, distribution, timing, and budget. Implementation and evaluation ensures proper execution and assessment of the program's success.
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The document discusses designing effective sales promotion campaigns. Some key steps include: 1) Setting sales goals and quotas to develop the plan; 2) Researching past successful promotions to determine popular products; and 3) Defining the type of promotion and calculating inventory needs. Additional tips include keeping promotions simple, upselling with loss leaders, promoting through advertising and social media, and evaluating campaign results. Outsourcing sales promotion can provide benefits like freeing up staff time and gaining expertise, but may result in undesirable outcomes if vendors do not meet standards. Online promotion challenges include generating awareness of the brand and driving purchase behavior.
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The document discusses various pricing strategies and considerations for setting prices. It outlines key factors that affect pricing decisions, including costs, competition, consumers, and economic conditions. It then describes different pricing methods such as cost-based pricing, demand-based pricing, competition-based pricing, product line pricing, and promotional pricing strategies. The goal of pricing is to maximize profits while achieving other objectives like sales growth and market share.
Pricing(A tool of Marketing Mix)
Price is determined by several factors including costs, customer perceived value, and competition. There are three main approaches to pricing: cost-based pricing which adds a markup to costs, value-based pricing based on customer perceptions, and competition-based pricing which matches competitors' prices. Other pricing strategies include penetration pricing to gain market share, market skimming to extract profits from early adopters, loss leader pricing to attract customers, and psychological pricing to influence perceptions. Product line, bundle, and segmented pricing are also used to target different customer groups.
Competition based pricing
This document discusses various competition-based pricing strategies that companies can use, including price leadership, predatory pricing, penetration pricing, skimming pricing, prestige pricing, price discrimination, and promotional pricing. It notes that price leadership involves a dominant firm setting prices that competitors then follow. Predatory pricing aims to drive out rivals but can be anti-competitive. Penetration pricing uses low initial prices to gain market share, while skimming pricing charges high initial prices for innovative products before competitors enter. The document also outlines advantages and disadvantages of competition-based pricing strategies.
M5 Pricing and Channels.pptx
This document discusses pricing methods and strategies. It defines price and discusses factors that affect price decisions like marketing objectives, costs, the nature of the market, and competitors. It also covers major considerations in setting price like pricing objectives, strategies, and procedures. Common pricing mistakes and major pricing strategies like cost-based, value-based, and product mix pricing are summarized as well.
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The document discusses various promotion strategies that companies use to inform customers about products and services. It describes above-the-line promotion using mass media advertising and below-the-line promotion using controlled media like direct mail. Common promotional activities include advertising, sales promotions, sponsorship, direct mailing, and public relations. Companies combine different activities to form a promotional mix based on cost, target market, and product. The goal is to move customers through the AIDA model from awareness to interest to desire to action.
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This document provides guidance on researching a company that currently sells a product. It outlines sections to research such as the company's history, headquarters, type of business model, primary products or services, major competitors, and the impact the product has had on the company's success, jobs, sales, promotions, and financials.
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[To download this presentation, visit:
https://www.oeconsulting.com.sg/training-presentations]
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Price
- 2. Price
- 3. Marketing Mix Price Amount a customer will pay; perception of a product’s value Selling price is made up of: ● Costs of Goods Sold (COGS) ● Desired profit (or profit margin) Influenced by: ● Expenses ● Supply/Demand ● Brand ● Competition Product Price Promotion Place Target Market
- 5. • Increase profits • Attract new customers • Maintain current customers • Increase profit per customer • Introduce new product • Generate cash • Improve Return On Investment
- 6. Price • Pricing Strategy • Importance of: • knowing the market • elasticity • keeping an eye on rivals
- 7. Price The price of a product will depend on: • The cost to make it • The amount of profit desired • The price competitors charge • The objectives of the business • The price customers are willing to pay • Is there a high demand? • Is demand sensitive to changes in price?
- 11. Pricing strategies and tactics Skimming Launching with a high price when there is little competition, then reducing the price later. Often used with technology. Penetration A low price is charged initially to penetrate the market and build brand loyalty. The price is then increased e.g. introductory offers on magazines. Competitive A similar price is charged to that of competitors’ products. Loss leader Products may be sold at a price lower than the cost to produce it. Often used by supermarkets to encourage people into the store where it is hoped they will buy other products.
- 12. Pricing strategies and tactics Psychological A price is set which customers perceive as lower than it is e.g. $39.99 instead of $40. Differential Different prices are charged for the same product e.g. bus fares for children are cheaper than adult prices. Cost plus pricing An additional ‘mark-up’ is added to the cost of producing a good or service. Strategic pricing Price is set to position an exclusive product or brand to make it more desirable for consumers, generate demand or demonstrate value
- 13. Pricing strategies change as the product passes through its life cycle •PREMIUM STRATEGY • Producing a high-quality product and charging the highest price •ECONOMY STRATEGY •Producing a lower quality product but charging a low price Rolex vs Timex watches
- 14. • GOOD VALUE STRATEGY •“We have high quality, but at a lower price” •OVERCHARGING STRATEGY •Company overprices its product in relation to its quality •GM uses combination of strategies, offering various automobiles Hummer – Cadillac - Pontiac Marriott – Courtyard Marriott – Residence Inn
- 15. P/Q Higher Price Lower Price Higher Quality Premium Strategy Good Value Strategy Lower Quality Overcharging Strategy Economy Strategy Pricing Strategies for New Products