Read more Even simpler industrial products, on the other hand, frequently have to be integrated into wider systems and as a result have very specific requirements and need intimate, expert examination and modification. It is difficult to imagine a turbine manufacturer or commercial website design buyer having a look at three or four products and then choosing one simply because it looks nice. The choice of turbine will involve a whole host of technical, productivity and safety issues, whilst the choice of website might be based on its integration into a wider B2B marketing campaign, its interactivity with users and the degree to which it draws potential clients via search engines. Buyers of consumer products are generally not interested in the technical details of what they are buying.
Answer In terms of the marketing mix some would say that pricing is the least attractive element. Marketing companies should really focus on generating as high a margin as possible. The argument is that the marketer should change productplace or promotion in some way before resorting to pricing reductions.
However price is a versatile element of the mix as we will see. The price charged for products and services is set artificially low in order to gain market share.
Once this is achieved, the price is increased. These companies need to land grab large numbers of consumers to make it worth their while, so they offer free telephones or satellite dishes at discounted rates in order to get people to sign up for their services.
Once there is a large number of subscribers prices gradually creep up. This is a no frills low price. The costs of marketing and promoting a product are kept to a minimum.
Supermarkets often have economy brands for soups, spaghetti, etc. Budget airlines are famous for keeping their overheads as low as possible and then giving the consumer a relatively lower price to fill an aircraft. The first few seats are sold at a very cheap price almost a promotional price and the middle majority are economy seats, with the highest price being paid for the last few seats on a flight which would be a premium pricing strategy.
During times of recession economy pricing sees more sales. However it is not the same as a value pricing approach which we come to shortly. Price skimming sees a company charge a higher price because it has a substantial competitive advantage. However, the advantage tends not to be sustainable.
The high price attracts new competitors into the market, and the price inevitably falls due to increased supply. Manufacturers of digital watches used a skimming approach in the s. Once other manufacturers were tempted into the market and the watches were produced at a lower unit cost, other marketing strategies and pricing approaches are implemented.
New products were developed and the market for watches gained a reputation for innovation. They form the bases for the exercise. However there are other important approaches to pricing, and we cover them throughout the entirety of this lesson. This approach is used when the marketer wants the consumer to respond on an emotional, rather than rational basis.
Consumers might practice a decision avoidance approach when buying products in an unfamiliar setting, an example being when buying ice cream. The choice is yours. Would you automatically by the cheapest?
Would you buy the most expensive? Or, would you go for a lawnmower somewhere in the middle? Price therefore may be an indication of quality or benefits in unfamiliar markets. Where there is a range of products or services the pricing reflects the benefits of parts of the range. Product line pricing seldom reflects the cost of making the product since it delivers a range of prices that a consumer perceives as being fair incrementally — over the range.
If you buy chocolate bars or potato chips crisps you expect to pay X for a single packet, although if you buy a family pack which is 5 times bigger, you expect to pay less than 5X the price. It might benefit the manufacturer to sell them singly in terms of profit margin, although they price over the whole line.
Profit is made on the range rather than single items. Companies will attempt to increase the amount customers spend once they start to buy.
For example airlines will charge for optional extras such as guaranteeing a window seat or reserving a row of seats next to each other.Be the first to hear about special promotional offers, new product arrivals and limited-time sales.
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Cookies help us identify account holders and optimize. Identify the Appropriate Strategy. The right pricing strategy for a product or service might not be a single strategy.
Identify the appropriate place and promotional strategy that should be used in developing the strategic marketing plan. Consumers rely on having a product in the right place and the right time and it .
Identify the appropriate place and promotional strategy. Identify the appropriate place and promotional strategy to develop the Ford Escape strategic marketing plan. Need at least words. Develop an initial sales promotion schedule for the Ford Escape.
At least words. Identify quantifiable elements that can be used to evaluate, monitor and control the effectiveness of the marketing plan. Welcome to Principles of Marketing, made up of many business majors.
Marketing is defined as "the total of activities involved in the transfer of goods from the producer or seller to the consumer or buyer, including advertising, shipping, storing, and selling." An alternate definition is paraphrased. MKTG Exam 3. Chp STUDY. PLAY. -People who are part of a this culture freely identify with a lifestyle or aesthetic preference.
-This culture exhibits their own unique set of norms, vocabulary, and product insignias. -Many of us feel that certain products and stores are appropriate .