SM%2007_pricing

SM 07_pricing - IntroductiontoSport Marketing Lecture7:SportPricing Lecture7.Overview ,andhowto performit Discussoth

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Introduction to Sport  Marketing  Lecture 7: Sport Pricing 
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Lecture 7. Overview Describe the strategic pricing process.  Outline the most common pricing goals. Outline the factors that influence price sensitivity. Explain what a break-even analysis is, and how to  perform it. Discuss other factors that influence pricing. Outline the common pricing strategies used in the sport  industry. 
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Price - the second element of the marketing mix
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Why Study Price? Price effects profitability. Pricing strategies change through the product life-cycle. Price effects  perceptions . Price communicates messages about the brand. Price reinforces the positioning strategy.
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Principle 7.1 : Pricing communicates an important symbolic  positioning message to consumers about a sport product. Price tells a consumer what to expect from the product: Quality?  Luxury? Value? Unruly game atmosphere? Status? Indulgence? Back-to-basics? Exclusivity?
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What is Price?  What a consumer gives up in exchange for a sporting  good or service.  Should reflect the value of a product. Usually thought of as money, but could be time or social  costs Important ideas related to price: value profit revenue
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Value How price relates to the benefits of the product. Consumers will feel that a product is good value if the  benefits received are equal to or greater than the price  paid.  It can be expressed as an equation:  
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Principle 7.2 : The value of a sport product is the relationship  between its price and the benefits a consumer believes they  will receive from it. 
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Principle 7.3 : The price of a product is the amount of money a  consumer must give up in exchange for a good or service.  Price also represents the value of a product.  Price is usually seen as an amount of money. It may also include other things a consumer sacrifices to  acquire a sport product, such as time or social cost.
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Revenue and Profit Revenue is the price that consumers pay for a product,  multiplied by how many units are sold Profit is revenue minus expenses.  higher price does not necessarily mean more profit to generate profit, price should not be  higher  or  lower  than  perceived value 
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Principle 7.4 : Revenue  is the price that consumers pay for a  product, multiplied by the number of units sold.  Profit  is  revenue minus the costs of producing and selling the product. 
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Strategic Pricing Process Setting a price should be planned with careful analysis  and a consistent aim. 
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Principle 7.5 : The strategic pricing process provides a structure 
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This note was uploaded on 11/10/2011 for the course MKTG 4870 taught by Professor Deborahlester during the Fall '11 term at Kennesaw.

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SM 07_pricing - IntroductiontoSport Marketing Lecture7:SportPricing Lecture7.Overview ,andhowto performit Discussoth

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