IND MRKT 12

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Industrial marketing presentation

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Price : The amount of money that is charged forsomething of value.

Prices are how much someone is willing to pay.

Price is called differently

SERVICE PRICE PAYMENT

university tuition landlord  rent 

banks 

interest 

transportation  fares highway  toll 

doctor ,lawyer  fee employee  wage 

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Dollar or UnitSales Growth

Growth inMarket Share

TargetReturn

MaximizeProfits

MeetingCompetition

NonpriceCompetition

PricingObjectives

SalesOriented

ProfitOriented

Status QuoOriented

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Target return sets a specific level of profit as

an objective.

Profit maximization to get as much profit as

possible.

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Sales-oriented objective: to get some level of unit

sales, dollar sales, or share of market, without

referring to profit.

Sales growth – for companies pioneering

innovative products or technologies to develop

markets. Growth in market share –  to enjoy better

economies of scale (more profits, lower costs).

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Status quo: “Don’t rock the pricing boat.” 

To stabilize prices, or meet competition, or even

avoid competition.

Non-price competition: aggressive action on one

or more of the Ps other than price.

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Demand

Costs

Competition

Technology

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Skimming price strategy

Market Penetration pricing strategy

Price Flexibility Strategy

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Price

Quantity

Initialskimmingprice

Secondprice

Finalprice

Skimming Pricing

Sell at highprice beforereducing to

next price leveland repeat

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Highly price sensitivity.

Cost of production and distribution fall with

accumulated output.

Market share is major goal rather then short term

high profit

High sale of complementary products

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One-price policy – used in mass selling The same price to all customers who purchase products

under essentially the same conditions and quantities

Flexible pricing (e.g., in channels, business markets,expensive consumer shopping products) – used in personalselling

 Offering the same product and quantities to differentcustomers at different prices.

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Cost plus pricing (Set the price at your production cost, including

both cost of goods and fixed costs at your current volume, plus a certain

profit margin)

Target return pricing (Set your price to achieve a target return-on-

investment (ROI) ).

Value based pricing (Price your product based on the value it

creates for the customer. This is usually the most profitable form of 

pricing, if you can achieve it. )

Psychological pricing (Ultimately, you must take into

consideration the consumer's perception of your price, figuring things like:

Positioning 

Fair pricing 

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