kotcha10 - 1 Chapter 10 Pricing Products Pricing...

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Unformatted text preview: 1 Chapter 10 Pricing Products: Pricing Considerations and Approaches 2 Price Price is the sum of all the values that consumers exchange for the benefits of having or using the product or service. Price has been the major factor affecting buyer choice; nonprice factors have become increasingly important in buyer-choice behavior. Price is the only element in the marketing mix that produces revenues; all others represent costs. 3 Factors Affecting Price Decisions ( Fig. 10.1) Internal Factors Marketing Objectives Marketing Mix Strategy Costs Organizational considerations External Factors Nature of the market and demand Competition Other environmental factors (economy, resellers, government) Pricing Decisions 4 Marketing Objectives Survival Low Prices to Cover Variable Costs and Some Fixed Costs to Stay in Business. Current Profit Maximization Choose the Price that Produces the Maximum Current Profit, Etc. Market Share Leadership Low as Possible Prices to Become the Market Share Leader. Product Quality Leadership High Prices to Cover Higher Performance Quality and R & D. Internal Factors Affecting Pricing Decisions: Marketing Objectives 5 Internal Factors Affecting Pricing Decisions: Marketing Objectives Other specific objectives include: Set prices low to prevent competition from entering the market, Prices might be reduced temporarily to create excitement or draw more customers....
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kotcha10 - 1 Chapter 10 Pricing Products Pricing...

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