Class11 Pricing1 - Copyright © 2009 Indiana University The...

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Unformatted text preview: Copyright © 2009 Indiana University The Marketing Mix Pricing M370 John Talbott Faculty Department of Marketing Fall 2010 Copyright © 2009 Indiana University Copyright © 2009 Indiana University Copyright © 2009 Indiana University Learning goals for today • Understand the relationship between elasticity and pricing goals and objectives. • Be able to provide examples of several different product mix pricing strategies. • Understand breakeven and breakeven with profit thresholds. • Understand the impact of price changes on profitability. Copyright © 2009 Indiana University Copyright © 2009 Indiana University Price • “ The amount of money charged for a product or service, or the sum of all the values that customers give up in order to gain the benefits of having or using a product or service.” “Armstrong/Kotler Copyright © 2009 Indiana University Copyright © 2009 Indiana University The power of price • Very powerful influencer on consumer behavior. • Flexible • Easy to change • Easy to communicate differences relative to competitors. Copyright © 2009 Indiana University Copyright © 2009 Indiana University Liquidity and Pricing Copyright © 2009 Indiana University Copyright © 2009 Indiana University Liquidity and Pricing Copyright © 2009 Indiana University Copyright © 2009 Indiana University What does this tell us about future levels of share prices? Copyright © 2009 Indiana University Copyright © 2009 Indiana University • A price offer does not establish the exchange value. • The value is established at the point of exchange. • In some cases the Price proposals are firm in others they are not. • Price proposals should never be based on the cost of the item/service that is fulfilling the demand. • Price must be based on consumer perception of value. This is called VALUE BASED PRICING Armstrong Kotler Text Copyright © 2009 Indiana University Copyright © 2009 Indiana University The Price is established when the currency for...
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Class11 Pricing1 - Copyright © 2009 Indiana University The...

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