Pricing Concepts
What are the 3 major pricing strategies?
Cost based
Competition based
Value based
_____________ pricing sets high initial prices for a new product to maximize profit before competitors enter the market.
Market-skimming Pricing sets high initial prices to “skim” revenue from the market.
Name the organizations in the Marketing (Distribution) Channel.
Producer
Agent
Wholesaler
Retailer
Name each of the components of the marketing mix.
Sales promotion
Public relations
Direct marketing
Personal selling
Name a type of media that is highly targeted i.e.can reach a very specific target audience.
Direct mail
Digital - Social - Mobile
Value-based pricing is based on........?
Value-based pricing uses the buyers’ perceptions of value vs. the seller’s cost.
_______________pricing sets a low initial price to penetrate the market and quickly attract a large number of buyers to gain market share.
Market-penetration Pricing sets a low initial price to penetrate the market and quickly attract a large number of buyers to gain market share
When a product is stocked in as many outlets as possible, this is known as _________.
Intensive distribution.
Which promotion mix component is best used to reach a Mass Audience?
A Pattern of Advertising Scheduling that schedules media evenly within a given period is known as _____.
Continuity—scheduling evenly within a given period
___________ demand is when there is a significant change in demand for a product when there is a change in price.
Elastic demand.
__________ pricing is when a company sells a core product cheaply to attract customers and then makes money by selling higher-priced, complementary products or accessories that are necessary for the core product to function.
Captive pricing
When a company sets up two or more marketing channels to Directly or Indirectly reach one or more customer segments (B2B and B2C Customers), this is known as _________.
Multichannel (Hybrid) Distribution System
Integrating and Coordinating The Promotional Mix To
Deliver A Clear Consistent and Compelling Message is known as __________.
Integrated Marketing Communications
Name the 3 Major Types Of Communication (Advertising) Tasks.
Informative
Persuasive
Reminder
$ Selling Price = Total Costs (Fixed + Variable Costs) + Markup %
_________ pricing is a strategy where a company offers a range of products at different price points
Product line pricing is a strategy where a company offers a range of products at different price points
Name at least one advantage of a Multichannel Distribution System.
-Greater Sales: the company expands its sales and market coverage
-Greater Customization: opportunities to tailor its products to the specific needs of diverse customer segments.
Name at least 4 levels of the Marketing Communication Funnel.
Awareness
Preference
Desire
Action
Retention
Loyalty
Name at least one type of Communication Impact Measure.
•Ad Recall - Do consumers remember the ad?
•Ad Message – Did consumers take away the key messages from the ad?
•Purchase Intent – Did the ad influence the consumer to buy?
•Brand Linkage – Do consumers associate the brand with the ad?
When Should a Company Take ‘Pricing Action’?
•Costs Increase
•The cost of making the product has increased significantly - Higher price
•
•Inventory Is Low
•Customer demand is greater than product inventory – Higher price
•Competition Changes Their Price
•The competition have raised or lowered their prices
•Consumer Demand Changes
•Customer demand for the product has significantly decreased – Lower price
•Customer demand for the product has significantly increased – Higher price
Which promotion mic component is used to drive consumer ACTION?
Salespromotion