MKTG 3000 Lecture Notes - Lecture 19: Private Label, European Cooperation In Science And Technology, Status Quo
I. Pricing
a. Price allocates resources in a free-market economy
b. Value=benefits/costs (price)
c. To the seller, price is revenue
i. PriceXQuantity=revunue
d. To the consumer, price is the cost of something
e. Price has never been an absolute measure, but rather a modifier value
i. What is the value to the consumer of this product at this time
f. Importance of price
i. Most readily changeable characteristic of an offering
ii. Relates directly to generation of revenues and quantities sold
iii. Key component of profit
iv. Symbolic value to customers—we equate price and quality to some degree-
prestige pricing
1. Like to hae the good stuff ad thigs that people ko ost a lot.
2. Like things that are higher price.
3. I searios of prie lies… good, etter ad est. People ted to get
one in middle
g. Thoughts about pricing
i. Walmart and target
1. sae oe, lie etter s epet ore, pa less
a. Expect more, pay less→ telling you that the stuff if going to be
good
b. Walmart tells you→ stuff will be okay, but youll save money so
that way you can live better
h. Trends influencing pricing
i. Flood of new products
ii. Increased availability of bargain-priced private label brands
iii. High levels of discounting expectations
1. Expect price promotion with many goods that we buy
2. An expectation
3. I eer pa full prie
iv. Internet/Apps used for comparison shopping
v. Internet price aggregators, shopping bots
i. Factors in determining price
i. DEMAND
ii. COST
iii. COMPETITION
j. “ettig priig is’t eas… high ipat o results
i. Goals and objectives in sync with product/org
ii. Valuation of benefits from customer’s POV- the demand
iii. Cost factors
iv. Infrastructure to manage pricing
v. Assignment of authority and responsibility (centralized or decentralized?)
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