COMM 223 Chapter Notes - Chapter 11: Geographical Pricing, Marketing Mix
12 Dec 2016
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Internal factors to consider when setting prices: marketing objectives. Before setting the price, the company must decide on its overall marketing strategy for the product/service: marketing mix strategy. Price decisions must be coordinated with product design, distribution and promotion decisions to form a consistent and effective integrated marketing program: organizational considerations. Management must decide who within the organization should set prices: the economy. Economic conditions can have a strong impact on the firm"s pricing strategies. Economic factors such as a boom or recession, inflation, and interest rates affect pricing decisions because they affect consumer spending, consumer perceptions, etc. Price adjustment strategies: discount and allowance pricing. Reducing prices to reward customer responses such as paying early or buying in large volumes: segmented pricing. Adjusting prices to allow for differences in customers, products or locations: psychological pricing. Pricing that considers the psychology of prices; the price says something about the product: promotional pricing. Temporarily reducing prices to increase short-run sales: geographical pricing.
