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Marketing > Price > Flashcards

Price Flashcards

1
Q

Price

A

value exchanged for offering, measures value to buyers and sellers. only mix element that produces revenue. captures value through profit

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2
Q

5C’s of pricing

A

company objectives, competition, costs, customers, channel members

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3
Q

Price competition

A

match or beat competitor pricing. frequent pricing changes on standardised products

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4
Q

Non-price competition

A

factors other than price distinguish product from competitors. features, quality, promotion, packaging

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5
Q

Factors affecting pricing decisions

A

objectives (marketing and pricing), costs, marketing mix variables, demand, customer interpretation of price and product, resellers, government, society

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6
Q

Economic factors on pricing

A

affect consumer spending and perception on price and value and therefore demand

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7
Q

Steps for establishing price

A

develop objectives, asses target market perception on price, evaluate competitors, select basis, select strategy, determine specific price

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8
Q

Developing pricing objectives

A

what company wants to achieve, forms basis of decisions, SMART, consistent with marketing and overall objectives

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9
Q

Pricing objective examples

A

sales, cash flow, survival, market share, profit/ROI, competitive effect, customer satisfaction, image/product enhancement, position

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10
Q

Assessing target market evaluation of price

A

perception of value from price and quality attributes. Also affected by demand

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11
Q

Price elasticity

A

how demand will change with change in price. elastic = drastic change. inelastic = little change

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12
Q

Influence on price elasticity

A

availability of products, price change viewed as temporary or permanent

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13
Q

Evaluation of competitor prices

A

Price above (strong brand equity - harvest), to match (price sensitive - hold) or below (low quality or new - build).

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14
Q

Selection of basis for pricing

A

cost-based pricing, customer value-based pricing, competition-based pricing

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15
Q

Cost-based pricing

A

adding dollar amount or percentage to cost of product. have to convince consumer to accept price. cost plus or mark up

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16
Q

Cost plus pricing

A

adding specific dollar amount or percentage to seller’s cost

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17
Q

Mark up pricing

A

adding pre determined percentage to cost of product

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18
Q

Advantages of cost based pricing

A

simple to calculate, low risk, at least covers costs.

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19
Q

Disadvantages of cost based pricing

A

doesn’t consider competitor, not related to market demand, may not be consistent with brand image, not related to PLC stage

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20
Q

Customer value-based pricing

A

based on benefits offered and demand. desired price of target market, more likely to buy.

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21
Q

Competition based pricing

A

influenced by competition prices. consumers judge on value and price compared to similar products

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22
Q

Pricing strategies

A

differential pricing, new product pricing, product mix pricing, psychological pricing, promotional pricing

23
Q

Differential pricing strategy

A

different prices for different customers but same product. negotiated and secondary market

24
Q

Negotiated pricing

A

bargaining

25
Q

Secondary market pricing

A

one price for primary target market and another for secondary. often international

26
Q

New product pricing strategy

A

price skimming or penetration

27
Q

Price skimming

A

charging highest possible price buyers who most desire will pay. recover R&D, quick cash flow, high quality. market share growth slow, attract competition

28
Q

Penetration pricing

A

setting prices low to penetrate a market and gain market share. discourage competition, economies of scale, brand loyalty. long cost recovery, cash flow problems

29
Q

Product mix pricing strategies

A

establishing and adjusting prices of multiple products across mix. Price lining, optional product pricing, captive pricing, bundle pricing

30
Q

Price lining

A

setting limited price points along entire product line

31
Q

Optional product pricing

A

optional or accessory products sold with main product

32
Q

Captive pricing

A

pricing products that must be sold with the main product, main product is cheap, related items expensive

33
Q

Bundle pricing

A

packaging two or more complementary products together and selling for a single price

34
Q

Psychological pricing

A

influences customer perception of price to make it more attractive. reference, bundle, multiple unit, EDLP, odd-even, customary, prestige

35
Q

Reference pricing

A

pricing a product at moderate level and placing next to an expensive similar product

36
Q

Multiple unit pricing

A

two or more identical products for the price of one

37
Q

EDLP

A

everyday low price.

38
Q

Odd-even pricing

A

ending price in certain numbers to influence buyer perception of price or product

39
Q

Customary pricing

A

based on traditional prices or perceived customer expectation

40
Q

Prestige pricing

A

setting high price to convey high quality

41
Q

Determining specific price

A

consider environmental forces and price adjustments

42
Q

Reasons for price adjustments

A

difference in customer, product, location, changing marketing environment

43
Q

Price adjustment strategies

A

trade discounts, quantity discount, cash discount, seasonal discount, allowances, special even pricing, periodic discounts, random discounts

44
Q

Discount pricing

A

straight reduction on product price during stated period of time or when purchasing larger quantities

45
Q

Allowance pricing

A

promotional monies paid by suppliers to retailers to feature their products

46
Q

Segmented pricing

A

allows for difference in customers, products or locations

47
Q

Promotional pricing

A

temporarily reducing prices to increase short term sales

48
Q

Geographical pricing

A

adjusting price on location

49
Q

Dynamic pricing

A

adjusting prices continually to meet characteristics and needs of individuals

50
Q

Types of market demand

A

pure competition, monopolistic, oligopolistic, pure monopoly

51
Q

Pure competition

A

many buyers and sellers, uniform trading, no marketing strategy

52
Q

Monopolistic

A

many buyers and sellers, range of prices, differentiation, price not affected by competition

53
Q

Oligopolistic

A

few sellers, high sensitivity to competitor, hard for new sellers to enter

54
Q

Pure monopoly

A

one seller, regulated/non regulated pricing,

Marketing (6 decks)

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