BUAD301 Chapter Notes - Chapter 9, 10: Price Ceiling, Geographical Pricing, Monopolistic Competition
3 Jan 2018
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Chapter 9 pricing: understanding and capturing customer value. What is a price: price is only element of marketing mix that produces revenue (all others represent cost, small percentage improvement in price can generate large percentage increase in profitability. Majoring pricing strategies: customer value-based pricing: uses buyers perceptions of value as key to pricing. Asses needs and value perceptions, set price to match perceived value, determine costs that can be incurred, design product. Good-value pricing offering the right combination of quality and good service at fair price. Value-added pricing attach value-added features and services to differentiate offers and charge higher prices. Cost-based pricing: set prices based on costs of producing, distributing and selling product. Design product, determine costs, set price, convince buyers of value. Cost-plus pricing / markup pricing adding standard markup to cost of product. Consumers base judgements of products value on prices competitors charge. Other internal and external considerations affecting price decisions.
