MKT 100 Lecture Notes - Lecture 10: Marketing Mix, Fixed Cost

• School: Ryerson University
• Department: Marketing
• Course: MKT 100
• Professor: Hamed Mehrabi

Document Summary

Price: overall sacrifice a consumer is willing to make (money, time, energy) to acquire a specific product. Reasonable price = perceived value at the time of the transaction. Prices can be both too high and too low. Price set too low may signal poor quality. Price set too high might signal low value. Price is the only element of the marketing mix that brings in revenue for the company; the other elements product costs. Pricing should be consistent with the goal of the company. As you increase the price, demand for the product decreases. Price to achieve revenue is as large as possible relative to total costs. Many believe market share indicates effectiveness (not always the case) Extreme competition may result in limited share growth. Ignore profits, competition, and the marketing environment as long as sales are rising. Short-term focus (cm declines, long-term makes a low-level profit) Requires little planning and resources: estimate demand, costs, and profits.