Pricing Strategy and Channel Distribution.

With any pricing strategy, the price must match the branding of the product. For example, for a luxury item branded product, the price needs to be higher to coincide with the branding perception. A few pricing strategies to focus on include product cost based strategy, customer-focused strategy, and product life-cycle strategy. The distribution strategy also plays a crucial role in the successful implementation of a new product. Furthermore, MM Inc. needs to determine what distribution channels will have the greatest influential means to market and sell the new product.

Loyalty programs include frequent flier miles or points systems associated with credit card offers that can be used only with the original company, creating a perceived loss or cost when switching to a competitor. Most programs are able to get consumers to spend more money just to get to free or bonus item.

In this assignment, pricing strategy for backpack will be discussed. After estimation of product’s cost, demand and mark up, we have to decide an appropriate pricing strategy for setting a base price for our backpack (Lamb etal. 2016). The alternative strategies for the backpack which would be discussed is price skimming and penetration strategy. Firms benefit from price skimming from high profit margin, perceived high quality and attract customers when price lowered, while it’s more applicable with inelastic demand, also attract competitors and having difficulty in adjusting appropriate time to lower the price. Penetration strategy brought positive effects such as low input cost, and it is suitable for elastic demand product. However, might result bankruptcy if company unable to survive in the beginning, it require long period for returns and low price might be tagged with low quality. The chosen strategy for backpack is price skimming which might results better effect on our targeted segment because outdoor enthusiasts aimed at high quality.

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Fall 2009 This case was prepared by Itir Karaesmen and Inbal Yahav of Robert H. Smith School of Business at University of Maryland, College Park. The names, locations, and other information included

Companies can choose many ways to set prices, skimming price strategy where a company sets a higher price than normal and a penetrating price where low initial price is set. “Pricing

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Predatory pricing is an exclusionary act by which a firm, in order to create or maintain a monopoly power, lowers its prices below the profit maximizing level in order to push rival firms out of the market or prevent them from ever entering the market. In the long run, this results to be a detriment to consumers. Once the competition has left the market, the company can then raise prices to a supracompetitive level and recoup the losses suffered by predatory pricing. This results in higher prices for the consumer. With no alternative product available, the consumer is left with no choice but to pay the high price.

The Case Study is provided by the Harvard Business School and is considered necessary reading prior to the understanding the responses contained herein. This paper is

Conducting an overall market analysis helps determine the target demographic and demand for your products, as well as your competitors and their distribution channels . Because Clear-Springs, Inc. wanted to maximize its profits, it operates strictly using E-Commerce. An online channel is disruptive to the traditional ways of marketing and distribution. Online selling

The second pricing strategy is the penetration pricing where the product enters newly into the market. To gain some consumer base from the competitors, the seller initially charges a lower price than the competitors. For example the ticket prices initially charged for IPL, Indian Premier League, matches were lower than the ticket price of the competition ICL matches. On the contrary, price skimming strategy is to grab the financially top class of the market and to do this, the seller charges high prices. The effectiveness of this strategy is based upon

This document is authorized for use only by Albertina Dias at ISG Business School until September 2013. Copying

Apple products appeal to buyers who are not conscience and therefore price elasticity is not a major problem. The different types of pricing strategies apple uses is that they set their products and offers different price ranges for each product based on the amount of storage the product offers. Apple’s strategic pricing of their products have helped the company flourish, because whenever a new apple product comes out, many

In the partial fulfillment of the requirement of Master of Business Administration (M.B.A.) Program (2002-2004) Hemchandracharya North Gujarat University, Patan.