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Customary Pricing
There are various types of pricing strategies followed in the market. They are psychological pricing, odd pricing, free onboard pricing, customary pricing, prestige pricing, dual pricing, ruling pricing, negotiated pricing, mark up pricing, etc. each one can be explained as follows:
Multiple Unit Pricing
“Multiple-unit pricing is a practice where a company offers consumers a lower than unit price if a specified number of units are purchased.”
What factors must be
considered when pricing
products?
✓ How does a change in price
affect the demand and supply of
a product?
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- What are the advantages of competitor-based pricing? What are the risks of using competitor-based pricing exclusive of other approaches and Identify a few industries in which taking competitor-based pricinginto account might be especially beneficial when developing anoverall pricing strategy. What caused you to select the industriesyou did?M/s. Reliable Incorporates wants you to assist in pricingstrategy and ensuring how could it reach to the clients thereby wanting to increase the profitability of the business. a. “Price is the only factor that generates revenue in marketing mix, while other factors concentrate at cost.” Understanding the fact, list down the different types of pricing strategies and select anyone pricing strategy you advise for the company with reasoning? b. “For success of any business organization, the most important factor in marketing mix is Location, Location, Location (Place/Distribution)” Assuming the fact, list down the various methods of channel distribution strategies and advise one such strategy for M/s. Reliable Incorporates with appropriate views?1. Illustrate how to calculate a breakeven point in terms of units and dollars using total fixed costs and variable costs in your calculation. 2. Which introductory pricing strategies have you noticed when you shop? 3. Illustrate two different pricing approaches that businesses use. 4. Which forecasting method would be most accurate for forecasting sales of hair-care products in the next year? How would your answer change if you were forecasting for the next month? For home appliances? 5. What is the most important part of a marketing audit? Why? What is the least important part? Why?
- What assumptions about J.C.Penny’s 5C’s (Customers, Competitors, Collaborators, Context, and Company) must hold true for the repositioning to be effective? What does Johnson perceive in these factors that lead him to believe that “Fair and Square” pricing can be a successful approach for J.C. Penney? read the case J.C. Penney's 'Fair and Square' Pricing Strategy. Harvard Business School Case.PRICING STRATEGY 1. How do sellers will give satisfaction to buyers? 2. What will be the buyers can give to sellers in return? 3. How will the buyer and seller relationship exist or maintain?Please find below Pricing options for firm A and B, along with individual payoffs (Firm A’spayoff/Firm B’s payoff)Firm BFirm APrice £2 Price £1Price £2 £20,000/£20,000 £10,000/£24,000Price £1 £24,000/£10,000 £12,000/£12,000Assume you are the pricing manager at Firm A;i) What is your payoff for a ‘maximin’ strategy?ii) What is your payoff for a ‘maximax’ strategy?iii) Does a dominant strategy exist within this prisoners’ dilemma?
- What is the difference between a skimming price strategy anda penetration pricing strategy? Under which circumstances iseach most likely to be used?5. What is meant by pricing? Describe any three strategies that can be done by firms if they do not want to increase the price of a product.Some firms have profit as a pricing objective. whereas others set prices forcustomer satisfaction. What are the ma;or drfferences between these two?Which is better
- If you were planning on creating an online financial brokerage service, how would you approach creating a pricing strategy with consideration to marginal cost, demand, the elasticity of demand, no of competitors, no. of substitutes, prices of similar products on the market etc.e. What are the advantages and disadvantages of profit-oriented pricing?Critical Thinking Penetration pricing is one approachto pricing for a new product launch. It is a helpfultactic to gain initial trials, build market share, discourage competitors, and pursue economies of scale.However, the initial price may set an expectation ofvalue among consumers and essentially position thebrand as a low-quality offering. This may result insome consumer resistance to purchasing the newproduct in the future if prices increase.In light of this trade-off between benefits and potential risks, to what extent do you think penetrationpricing is a suitable approach to helping a new product become successful in the marketplace? Would it bemore appropriate to have some form of sales promotion or other incentive to encourage initial sales insteadof some form of discounting? Do you think that a lowprice, even for an introductory period, would result ina negative perception of the brand?