PRICING

Importance of Pricing
One of the Ps Price Route and Non Price Route

Factors Influencing Pricing

Internal Factors
Marketing Objective Basic Characteristics of the Product Stage in the PLC Cost of Manufacturing and Marketing Distinctiveness of the Product Demand of the Product

External Factors
Market Characteristics Buyer Behavior Competitors Pricing Policy Govt Rules and Regulations Legal Aspects Understanding with members of Cartel

Steps in Setting Price

Selecting the Pricing Objective
Survival Maximum Current Profit Maximum Current Revenue Maximum Sales Growth or Market Penetration Pricing Maximum Market Skimming Product Quality Leadership

Determining Demand
Elastic Demand Inelastic Demand

Estimating Costs
Fixed Costs Variable Costs

Analysing Competitors Prices & Offers

Selecting a Pricing Method

Mark Up Pricing (Unit cost/1-Desired return on sales in %) Target Return Pricing (Unit Cost + (Desired return in %
* Invested Capital)/Unit Sales)

Perceived Value Pricing Going Rate Pricing Sealed Bid Pricing

Selecting the Final Price

Psychological Pricing The Influence of other marketing mix elements on Price Impact of Price on other parties

Different Price Quality Strategies

Price High Premium Strategy High Medium Low

High Value Strategy Superb Value Strategy

Product Over Charging Quality Strategy Medium

Average Strategy

Good Value Strategy

Rip Off Strategy Low

False Economy Strategy

Economy Startegy