Price strategies in the marketing mix

1. Product
Price
Place
Promotion

2. PRICE
It’s the value agreed upon by the buyer and the
seller in an exchange; one of the four controllable
variables (with product, promotion and place) of
the marketing mix.
To the consumer, Price is
the cost of something,
and to the seller is
revenue, the primary
source of profits.

3. $85.00
$40.00
$60.00
The purchasing decision is based on how consumers
perceive the price, and what they are willing to pay
Same coffe?

4. How to determine the Price of products or services?
Marketing Mix
estrategies
Costs
Organizational factors
Marketing objectives
Market structure and
demand
Competitors
Environmental
factors: Economy,
intermediaries, laws
etc.
Pricing
decisions
Internal Factors External factors

5. Price should be coordinated with product or service
design, distribution channels and promotional
decisions
Internal factors
1. Marketing Mix

6. Internal factors
2. Costs
The company must set a price that covers the costs of producing,
distributing and selling its products or services, including a fair profit
for its effort and risks involved.

7. The Mkt. Department
determine the prices in
big businesses
The large hotel companies
develop a marketing plan with
monthly rates, based on the
expected occupancy.
Internal factors
3. Organizational factors
The owners
determine the
prices in smal
businesses

8. LUXURY HOTELS
ECONOMIC BUSINESS HOTELS
The Company must decide how to position their
products or services in the market
Internal factors
4. Marketing objectives

11. While prices cover fixed
and variable costs, the
company remains in the
market
(Low seasons, too many
competitors, product
decline etc. )
Types of Marketing objectives
Survival pricing

12. Maximun revenue: The company estimates the
demand and costs associated with alternative pricing, and
chooses the price that gives it the highest profit, cash flow,
or return of investment.

13. Maximun market share: the company believes that
selling by volume will lower costs and increase
profits. They set the lowest price, assuming the
market is price sensitive.

14. Maximun market advantage: companies that develop
new technologies, set high prices taking advantage of
the market opportunity. Prices start high, and end
low. Example introduction of flat T.V. Screen.

15. Quality lidership: Many luxury brands position their
products or services as the best quality in their category,
combining quality, luxury and high prices, with intense
customer loyalty.

16. Despite price freedom, competition conditions price fixing
1. Competitors
External factors

17. 2. Determination of demand and market
Aunque los costos determinan el nivel mínimo de precios, el
mercado y la demanda determinan los niveles de precios
máximos.
External factors

18. Pricing strategies
Pricing strategy refers to method companies use to price
their products or services. Almost all companies, large or
small, base the price of their products and services on
production, labor and advertising expenses and then add
on a certain percentage so they can make a profit.

19. 3 Mayor
Pricing
Strategies
Customer
value-based
Pricing
Cost- based
Pricing
Competition-
based Pricing

20. Pricing strategies
Discount
Price
Segmentation
Price Psychological
Price
Promotional
Price
Geographic
Price
International
Price

21. The price and life cycle product
Introduction
Stage of high spending, lots of promotion,
advertising and information.

22. Growth
More competitors
Product differentiation
The price and life cycle product
Reduce costs

23. Maturity
Price war
More control and costs reduction
New product lines
New target markets
Better distribution channels
The price and life cycle product

24. El precio y el ciclo de vida del producto
Declination
Repositionig
Consolidation
Abandonment
Minimizing losses

25. Than you