BU121 Lecture Notes - Lecture 5: Value-Based Pricing, Promotional Mix, Direct Marketing
Document Summary
There are no formulas, figure by taking into account: 1. Costs: competitor pricing, feedback from customer and value chain partners, breakeven and markup. Can then reach a number that can be tested in the market. Channels and intermediaries, alternative arrangements, functions of channels, intensity of distributions, decision and implications. Intensity of distribution depends on how accessible you want your product ie bread vs engagement ring. Choice must fit; perception of retailer needs to be considered - consistency b2b or b2c. Decisions and implications: must sell to intermediary as well as consumer, and lose control over how its sold and the effort made. Push promotion: promote to wholesaler, entice them to put your product on the shelf volume discount. Cooperative advertising; give money to advertise the product - get some control how it looks. Detailing; stocking merchandise for retailers and training employees - shopping products exclusive distribution arrangements (set geographic location) - specialty goods.
