BU352 Chapter Notes - Chapter 11: Price Discrimination, Loss Leader, Price Skimming
Document Summary
Successful pricing strategies are built through the five critical components: company objectives, customers, costs, competition, and channel members. Each firm embraces an objective that seems to fit with where management thinks the firm needs to go to be successful. Company objectives often can be expressed in slightly different forms that mean different things. Profit orientation a company objective that can be implemented by focusing on target profit pricing, maximizing profits, or target return pricing. Target profit pricing a pricing strategy implemented by firms when they have a particular profit goal as their overriding concern; uses price to stimulate a certain level of sales at a certain profit per unit. Maximizing profits strategy a mathematical model that captures all the factors required to explain and predict sales and profits, which should be able to identify the price at which its profits are maximized.
