DQ1
A number of factors contribute to the pricing strategies for a product. Considering the segments in the simulation, what pricing strategy would be most effective considering both the market’s needs and the product life cycle? As the product moves through the life cycle, how should the pricing strategy change?
DQ2
Define brand positioning. Explain the reason for positioning and repositioning products. Choose a product with which you are familiar, preferably one in your industry, and explain how it might be repositioned. Indicate its current position in the market, a desired position, and how you would manage the repositioning effort.
Erica’s response
Revenue generation is one of the gauges for success of a business. There are several factors that affect the revenue generated and pricing is a key component. Price is the one element of the marketing mix that produces revenue, the other elements produce costs (Kotler & Keller, 2016). The product’s life cycle is shaped as a bell-curve and has four stages, introduction, growth, maturity, and decline (Kotler & Keller, 2016).
Along with the product life cycle, comes pricing strategy. The product line pricing seems to be the most beneficial for the business we are running. Product line pricing takes place when goods and services are separated into cost categories in order to establish different quality levels in the mindset of consumers (Kotler & Keller, 2016). The business we are running utilizes product line pricing allowing us to differentiate between the three types of bicycles being sold. Even though the products are in the same product line, pricing the bicycles differently sets them apart from one another and targets different consumers for different bicycle customers. Again, although these bikes are sold in the same company, each bike has very different uses including recreational use, speed and mountain biking.
As the life cycle continues, the pricing strategy is adjusted to continue to move product. For our business, we still need the company name to bring a level of prestige to the product. We set prices above the price consumers stated they are willing to pay for the bikes. This set pricing was chosen as opposed to perceived value pricing which is the price customers are willing to pay for a good or product (Kotler & Keller, 2016). As prices need to be adjusted and perhaps decreased, the prices will still be set slightly above the willing to pay price. The strategy will keep the pricing competitive and product moving with revenue generation still as the focus.
Kotler, P., & Keller, K. L. (2016). A framework for marketing management (6th ed.). Upper Saddle River, NJ: Pearson/Prentice Hall. ISBN-13: 9780133871319
Renae response
Pricing is extremely necessary element of marketing mix additionally it assists firm to produce revenue profit. firm requires to pick up proper pricing approached to make more put a question to and double sales of its product services.
The pricing approache of company’s product vary according to market requires and product life cycle. At introduction stage, when product is newly launched and new to the market then firm can pick up either market penetration or market skilmming strategy. Pricing practices have changed significantly, thanks in part to a severe recession in 2008–2009, a slow recovery, and rapid technological advances. ( Kolter 2016)
If Sign is global and well reputed, then firm can put skimming approache to charge lofty prices on the begin and coast off all the profit love samsung does. If Sign is new in the market, then it would charge low tag to penetrate the market love Xiaomi did. Common pricing mistakes include not revising price often enough to capitalize on market changes; setting price independently of the rest of the marketing program rather than as an intrinsic element of market-positioning strategy. (Kotler 2016)
At Growth stage when product is begining to get attention and put a question to then firm can charge either competitive or assessment-based pricing. If there’re a lot of few competitors the price based pricing is excellent because firm will charge by according to how customer rate thier product. if there’re a lot of more competitors at this stage then competitive based pricing to take on competition.
At maturity stage, there’re a lot of numerous competitors already and demad is no more rising. In this case, Industries require to use low price tag pricing where they retail thier products at discounted or lower tag to double put a question to as much as possible.
At refuse stage, product is no longer in demand. At this stage either firm can abscond the product or use bundle pricing to advertise the product with other products or services.
Reference:
Kotler, P., Keller, K.L. (2016). A Framework For Marketing Management (6th ed.). Prentice-Hall: Pearson Education, Inc.
Kim response
Brand positioning can be defined as a marketing strategy that aims to make a brand occupy a distinct position, relative to competing brands, in the mind of the customer. Organizations apply this strategy either by emphasizing the distinguishing features of their brand or “they may try to create a suitable image (inexpensive or premium, utilitarian or luxurious, entry-level or high-end, etc.) through advertising. Once a brand is positioned, it is very difficult to reposition it without destroying its credibility” (“Brand,” 2019). One of the products my company manufacturer is a stapler used in surgery. The stapler is used for cases such as gastric sleeve or gastric bypass which both are considered “stapling the stomach surgeries. The other market was cardiothoracic surgeons due to the staplers’ ability to staple through extremely thick tissue. However, the latest surgical technique is to use a robot.
The surgeon is still doing the surgery, but the robot requires the use of its own branded staplers, so sales are dropping dramatically. The stapler could be repositioned and sold to orthopedic surgeons who specialize in amputations since muscle is extremely thick as well and it has FDA clearance for this use as well. Orthopedic surgeons do not use the robot since most of the cases they do are very physical and external in nature versus gastric cases which are done internally through small ports. By using the stapler on muscle, the ortho’s would save time and money since suture is more expensive than the stapler. Both are important to the hospital and the surgeon.
Brand positioning. (2019). Retrieved from http://www.businessdictionary.com/definition/positioning.html
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