An Investigation Into Pricing Strategies of Wal-Mart in China

6348 Words26 Pages
44242 Independent Study

An investigation into pricing strategies of Wal-Mart in China

Module Leader: Gunjan Saxena
Student ID: 200912567
Date: 17/05/2009

Executive Summary

The report is an investigation about Wal-Mart’s pricing strategies in China, which consists of three parts.

The part 1 includes five points relevant information. To begin with, it will have an introduction for this investigation to assess the brief of Wal-Mart and its pricing strategies in China. The next is setting up one main aim of investigation Wal-Mart’s pricing strategies in China, followed by identifying three objectives of this study. The next is literature review about pricing strategies. The final is methods using in this
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4. Literature Review

Price, one of four key elements of the market mix, is the most sensitive factors for improving market shares, revenues, profitability and consumers shopping, influencing other marketing mix elements such as product, promotion and place (David, 2008; Laurus, 2008; Net MBA, 2009). Pricing strategy decision-making should be matter of all factors of marketing mix rather than considering prices (Laurus, 2008).

In terms of theory, pricing strategies can be defined as businesses choosing one method to appeal to customers to purchase goods and achieve marketing mix according to the assessment of consumer demand and cost analysis (BDS Forum, 2009). For a company, pricing strategies can be made difficultly. If prices of goods are too higher, they may lose market share. If the price is two lower, the company cannot get bigger profit (Bized, 2006). Therefore, before developing a pricing strategy, the company has to consider much more factors. Such as pricing objectives which rely on production cost, barriers to entry, rate of product diffusion and so on, pricing methods including cost-plus pricing, target return pricing, value-based pricing and psychological pricing as well as other factors to make the best price for the firm and the consumer (Net MBA, 2009). Three points of views of pricing strategies can be discussed in the following in this report. Firstly, pricing strategies should

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