pricing objective

1. C. PRICING OBJECTIVES
To survive in today’s highly competitive marketplace, companies need pricing objectives
that are specific, attainable, and measurable. In a marketing term, pricing objectives falls
into 3 categories: (1) profit-oriented (2) sales-oriented and (3) status quo. As well as its
vision which is to bring people of all ages, races and background together to enjoy “Soul
Food”-“proper food with a reasonable prices”-within bright and fun interiors, KFC is
designed to be perceived as a fun and inclusive brand. KFC much refer in a category
number (2).
(1) Profit-Oriented
This type of pricing objectives include profit maximization, satisfactory profit, and target
return on investment.
(2) Sales-Oriented
- KFC makes their sales pattern as their main objective. Rather than to maximize profits,
their management is more focus to increase sale of production and increase customer
satisfaction. Sales-oriented pricing objectives are based either on market share or on
dollar or unit sales. The marketing manager should be familiar with these pricing
objectives. This pricing objectives includes market share and sales maximization. Table
2.2 shows you how KFC set their product price as to get along with their sales objectives.
Market Share
- is a company’s product sales as a percentage of total sales for that industry.
Larger market shares have indeed often meant higher profits, greater economies
of scale, market power and ability to compensate top-quality management. Take
KFC as an example. To survive in the market share, KFC need to get along with
their competitor with slow growth and few product changes. If not, they’ll lose
their track performance in various product categories over time and make them to
buy frequently bought items.
Sales Maximization

2. - a firms with the objective of maximizing sales ignores profits, competition, and
the marketing environment as long as sales are rising. They execute their sales
maximization and undergo sales promotional in the long-run. Sales maximization
can also be effectively used on a temporary basis to sell off excess inventory. It is
no wonder nowadays there is a lot of promotional strategy that most firms or
franchises used to market their product. KFC itself uses all kinds of strategy and
tactics to run their sales.
CHICKEN
Why we’re famous
RM3.10
SANDWICHES
KFC made portable
RM3.70
SIDES
Hardly second
fiddle
RM1.65
KFC BOWLS
Layers of flavors
RM3.10
SALADS
Something a little
greener
RM3.50
DESSERT
Sweet southern
cooking
RM1.90
FLAVORS &
SNACKS
The flavors you
crave
RM2.10
KIDS MEALS
Please the picky
RM2.65
Table 2.2: KFC meals with great taste and great values
(3) Target Return On Investment
The most common profit objective is a target return on investment (ROI), sometimes
called the firm’s return on total assets. It measures the management’s overall
effectiveness in generating profits with the available assets.