BU352 Chapter Notes - Chapter 11: Price Discrimination, Price Ceiling, Profit Margin
Document Summary
Consumers judge benefits a product delivers against the sacrifice necessary to obtain it: how they determine value. Key to successful pricing is to match the product or service with consumer"s value perceptions. A price set too low may signal low quality, poor performance, and other negative attributes. High value may came at a relatively high or low price. Only element of marketing mix that generates revenue. Consumers usually rank price as one of the most important factors in purchase decisions. Most challenging of 4 p"s to manage. Many managers have overly simplified view of price: it is not just the amount of money a consumer parts with, it is also an information cue used to judge quality. Should be treated as a strategic opportunity to create value. The 5 c"s of pricing: company objectives. Each firm embraces objective that fits with where management thinks the firm needs to go to be successful in: dependent on how they define success.
