MBA 652 Week 7 Discussion Questions

MBA 652 Week 7 Discussion Questions - 1. Expanding on the...

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1. Expanding on the discussion price as an indicator of value in the book, discuss the pros and cons of this belief. Why would marketers use encourage this idea? Give specific examples and support your answer. According to this concept, the idea of value is all about the customer’s perception of benefits (Kerin & Peterson, 2010). Successful marketers should be able to research target markets to determine what customers perceive as a value-added benefit, or a missing option that would devalue an item and therefore lead to a decrease the price. The difficult part of this concept is to find the right price range. If the price is set too low a price war could begin, which eliminates any potential benefits to all competitors. If the price is set too high, other competitors will follow the trend to gain a share of the profits (NetMBA, n.d.). The main pro of this belief and the reason marketers would encourage this idea is the potential for huge profit if the product is priced, positioned and advertised properly to build the perception among consumers that a product has a high price value. Also, Additionally consumers can be persuaded from one product to another if the value is right. This leads to market expansion and greater market share percentage. Finally, when a brand is perceived as having a higher price value, that high value tends to stay with the brand for the long term (Reference for Business, n.d.). The main con of this belief and the reason marketers may discourage this idea is the potential for huge loss if the product is priced, positioned and advertised improperly, which could build the perception among consumers that the product is cheap (or expensive) with minimal value for the price. This could push consumers to find a substitute product, and lead to market retraction and decreased market share
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percentage. Finally, a brand will suffer in the long term if it becomes known as cheap, with little value for the price (Bovay, 2008). An example of a marketing campaign that has achieved high price value is
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MBA 652 Week 7 Discussion Questions - 1. Expanding on the...

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