The Price Is Right Nature of Pricing LAP

The Price Is Right Nature of Pricing Describe the pricing function. Explain the role

$ What Is Pricing? § A marketing function that involves the determination of an

Pricing § Like a tug-of-war between buyers and sellers • Buyers—want low prices •

Characteristics of Effective Pricing § Realistic § Flexible § Competitive

Prices Have Many Names § Interest § Wages/ § Admission § Service § Fees

Factors Affecting Price § § § § Costs Supply and demand Economic conditions Competition

Explain the role of pricing in marketing.

How Pricing Affects Product Decisions § Research § Materials used in production § Profit

How Pricing Affects Promotion Decisions § Choice of medium § Amount of money spent

How Pricing Affects Place Decisions § Choice of transportation channels § Where the product

Pricing Objectives § Goals marketers have for their pricing strategies § May relate to:

§ Your jeans • How much did you pay? • What factors contributed to

§ “Publishers and Booksellers see a ‘Predatory’ Amazon: ” http: //www. npr. org/2012/01/23/145468105/publisher s-and-booksellers-see-a-predatory-amazon

Acknowledgments Original Developers: Kerry Winfrey and Lelia Ventling, MBAResearch Version 2. 0 Copyright ©

Digital-based photography sources: Think. Stock Photography Various images used in this presentation are ©

Copyright: All photographic digital images on this CD are owned by the aforementioned photographic

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The Price Is Right Nature of Pricing LAP 2

The Price Is Right Nature of Pricing Describe the pricing function. Explain the role of pricing in marketing.

Describe the pricing function.

§ Jay and Paolo’s snowboards • • § $400 vs. $80 Premium vs. off-brand Winter vs. off-season Local store vs. special order Pricing: not always a straightforward task

$ What Is Pricing? § A marketing function that involves the determination of an exchange price at which the buyer and seller perceive optimum value for a good or service § Important for: • Customer satisfaction • Continued success of a business

Pricing § Like a tug-of-war between buyers and sellers • Buyers—want low prices • Sellers—want high prices § Must find balance

Characteristics of Effective Pricing § Realistic § Flexible § Competitive

Prices Have Many Names § Interest § Wages/ § Admission § Service § Fees § Dues § Fare § Tuition § Rent salary charge

Factors Affecting Price § § § § Costs Supply and demand Economic conditions Competition Government regulations Channel members Company objectives and strategies

Explain the role of pricing in marketing.

How Pricing Affects Product Decisions § Research § Materials used in production § Profit decisions § Customer decisions § Company image

How Pricing Affects Promotion Decisions § Choice of medium § Amount of money spent § Time allocated to promotion

How Pricing Affects Place Decisions § Choice of transportation channels § Where the product is offered

Pricing Objectives § Goals marketers have for their pricing strategies § May relate to: • Profitability • Sales • Competition • Image/Prestige

§ Your jeans • How much did you pay? • What factors contributed to the price?

§ § Amazon’s success Predatory pricing

§ “Publishers and Booksellers see a ‘Predatory’ Amazon: ” http: //www. npr. org/2012/01/23/145468105/publisher s-and-booksellers-see-a-predatory-amazon § What do you think?

Copyright: All photographic digital images on this CD are owned by the aforementioned photographic resources or their licensors and are protected by the United States copyright laws, international treaty provisions, and applicable laws. No title to or intellectual property rights to the images on this CD are transferred to you. These sources retain all rights and are not to be used, digitally copied, transferred, or manipulated in any way. To do so is a violation of federal copyright laws.