chapter 8th - march 21st Flashcards
what are these referring to:
-A strategic opportuinity to create value
- Pricing signals quality or lack thereof
- Should not be an afterthought to the rest of the marketing mix
- Think Target in Canada
the importance of pricing
- Usually ranked as one of the most important factors in purchase decisions
- The only element in the marketing mix that generate revenue
- The most challenging of the 4 ps to manage because it is the least understood
what is price
what type of orientation is this
- Target return on investment ROI
- Maximize profits
Profit orientation
what type of orientation is this
- Maximizing sales
- Maximizing market share
Sales Orientation
examples of _______demand
- Milk
- Gasoline
- Carbon tax
Inelastic - necessity
examples of _______demand
- Louis vitton
- Luxury
Elastics - wants
The economy, government laws and regulations
competitors
- Elastic price elasticity of demand
- Enelastic price elasticity of demand
prices elasticity
- Penetration pricing strategy
- Price skimming strategy
- Cost plus pricing
- Odd even pricing
- Prestige pricing
5 pricing strategies
name 5 pricing strategies
- Penetration pricing strategy
- Price skimming strategy
- Cost plus pricing
- Odd even pricing
- Prestige pricing
determine middle ground for pricing and establish “expensive/cheap”
Price lining
start with a price “$20 gift for secret santa”
Demand backward pricing
aggressively priced item, but also get something else (sephora sales)
Loss leader pricing
walmart, not as low as lowest in marketplace,
Everyday low prices
think cogeco, rodgers, hoping to get you to pay more
Price bundling
raptors game food or drinks, cineplex, monopoly inside gates
Captive pricing
entire line of pricing
Product mix pricing -
gilette or coffee, price for razor and handle, price for machine and pods
Two part pricing
subway sub for $4.99 rather than $6.99
Promotional pricing
5 payments instead of paying upfront
Payment pricing
price changes min my min on travel sites
Dynamic pricing
netflix and spotify,
Subscription based pricing
student fare or discount, child tickets, senior fare
Price discrimination
is the amount of money a buyer is willing to pay for a security.
sales bid pricing
the maximum amount of money an advertiser is willing to pay for each click on an advertisement
Bids
when a business sets the price of its product or service based on the market price
Going rate pricing
If a company sells a product that costs $5, buying 100 of those units would cost $500. To entice buyers to purchase its product, a company may offer a ________ _______, selling 100 units for $450, which would make the per unit cost $4.50 instead of $5; a 10% discount.
quantity discount
buying a wonderland pass now rather than in june, or buying winter clothing in spring
seasonal discount
you pay delivery
free on board orgin
you pay shipping all the way from destination, wayfare
FOB destination
one shipping fee for anywhere in the country
Uniform Delivered Pricing
if your brand will be promoted by them, or seen in store
Trade Allowances
2 organizations lean on each other and often benefit
Reciprocal Agreements
if you come back to starbucks after 2pm we will give you a discount, after already buying a drink in the morning
bounce back
a strategy used by businesses to attract customers to a new product or service by offering a lower price initially
penetration pricing strategy
a product pricing strategy by which a firm charges the highest initial price that customers will pay and then lowers it over time
price skimming strategy
a pricing strategy by which the selling price of a product is determined by adding a specific fixed percentage (a “markup”) to the product’s unit cost
cost plus pricing
psychological pricing strategies that help businesses shape consumers’ value perceptions — one where businesses end prices with odd numbers (i.e. $99.99) and another that does the same with whole number tenths (i.e. $100.00).
odd even pricing
a pricing strategy in which prices are set at a high level, recognising that lower prices will inhibit sales rather than encourage them and that buyers will associate a high price for the product with superior quality; also called Image Pricing.
prestige pricing
