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    zeyad boyka
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    This document discusses pricing strategies and concepts from Chapter 10 of the textbook "Principles of Marketing". It defines price as the amount paid for a product or service. It outlines major pricing strategies such as customer value-based pricing, which sets prices based on customer perceptions rather than costs, and cost-based pricing, which sets prices based on production and selling costs plus profit. It also covers competition-based pricing, which bases prices on competitors' strategies, costs and offerings.

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    This document discusses pricing strategies and concepts from Chapter 10 of the textbook "Principles of Marketing". It defines price as the amount paid for a product or service. It outlines major pricing strategies such as customer value-based pricing, which sets prices based on customer perceptions rather than costs, and cost-based pricing, which sets prices based on production and selling costs plus profit. It also covers competition-based pricing, which bases prices on competitors' strategies, costs and offerings.

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    1 views11 pages

    Chapter 10

    Uploaded by

    zeyad boyka
    This document discusses pricing strategies and concepts from Chapter 10 of the textbook "Principles of Marketing". It defines price as the amount paid for a product or service. It outlines major pricing strategies such as customer value-based pricing, which sets prices based on customer perceptions rather than costs, and cost-based pricing, which sets prices based on production and selling costs plus profit. It also covers competition-based pricing, which bases prices on competitors' strategies, costs and offerings.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 11

    Principles of Marketing

    Seventeenth Edition

    Chapter 10

    Pricing: Understanding and


    Capturing Customer Value

    Copyright © 2018 Pearson Education Ltd. All Rights Reserved.


    Learning Objective 1
    Answer the question “What is a price?” and discuss the importance of pricing
    in today’s fast-changing environment.

    Copyright © 2018 Pearson Education Ltd. All Rights Reserved.


    What Is a Price?

    Price is the amount of money charged for a product or service, or the sum of
    all the values that customers exchange for the benefits of having or using the
    product or service.

    Copyright © 2018 Pearson Education Ltd. All Rights Reserved.


    Major Pricing Strategies

    Copyright © 2018 Pearson Education Ltd. All Rights Reserved.


    Major Pricing Strategies
    Customer Value-Based Pricing

    Value-based pricing uses the buyers’ perceptions of value rather than the
    seller’s cost.
    • Value-based pricing is customer driven.

    • Cost-based pricing is product driven.

    • Price is set to match perceived value.

    Copyright © 2018 Pearson Education Ltd. All Rights Reserved.


    Major Pricing Strategies

    Copyright © 2018 Pearson Education Ltd. All Rights Reserved.


    Major Pricing Strategies
    Customer Value-Based Pricing
    Good-value pricing is offering just the right combination of
    quality and good service at a fair price.

    Everyday low pricing (EDLP) involves charging a constant


    everyday low price with few or no temporary price discounts.

    High-low pricing involves charging higher prices on an everyday


    basis but running frequent promotions to lower prices temporarily
    on selected items. Copyright © 2018 Pearson Education Ltd. All Rights Reserved.
    Major Pricing Strategies

    Customer Value-Based Pricing

    Value-added pricing attaches value-added features and services to


    differentiate the companies offers and thus their higher prices.

    Copyright © 2018 Pearson Education Ltd. All Rights Reserved.


    Major Pricing Strategies
    Cost-Based Pricing

    Cost-based pricing sets prices based on the costs for producing, distributing,
    and selling the product plus a fair rate of return for effort and risk.

    Fixed costs are the costs that do not vary with production or sales level.
    •Rent

    •Interest

    •Executive salaries

    Copyright © 2018 Pearson Education Ltd. All Rights Reserved.


    Major Pricing Strategies
    Cost-Based Pricing

    Variable costs vary directly with the level of production.


    • Raw materials

    • Packaging

    Total costs are the sum of the fixed and variable costs for any given
    level of production.
    Copyright © 2018 Pearson Education Ltd. All Rights Reserved.
    Major Pricing Strategies

    Competition-Based Pricing

    Competition-based pricing is setting prices based on competitors’


    strategies, costs, prices, and market offerings.

    Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

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