Pricing of Industrial Products and Services

In: English and Literature

Submitted By shahrukhmsheikh
Words 935
Pages 4

Introduction “Price is the measure by which industrial customers judge the value of an offering and it strongly impacts brand selection among competing alternatives”. (Shipley and Jobber (2001, p. 301). Pricing is a process where a business firm sets the price at which it will sell its products and services in such a way that it can generate profit as well as satisfy the customer, and it may be a part of the business’s marketing plan. Price management is a very critical element in marketing and competitive strategy and a key determinant of performance. Among different pricing strategies, marketing managers can choose their preferred type. The overall objective of pricing is to increase sales and profits globally (Kigan, 2001).Global Pricing subject can be fully integrated and considered into the product design process (Kigan, 2001) As the ultimate aim of the industry is to earn profits so pricing of industrial products and services should be based on desire of the customer.
A company set the price for the first time for the following items i.e. when a new item is manufactured or a new product comes from normally when an item is directed to a new distribution channel, or it is offered to a new geographic area. Companies need to decide the positions of their product in terms of their quality and price.
Literature review
Research shows marketing scholars have devoted only little effort to pricing theory and practice. This lack of academic research in the field of industrial pricing is also evident when it comes to new product pricing, since review of relevant literature reveals limited number of empirical studies. Since none of the studies has focused on the antecedents of the alternative new product pricing strategies that an industrial firm may formulate. All classical marketing describe three basic strategies for…...

Similar Documents

Service and Product

...1 SERVICE CONCEPTION Services are all around us, people use service every day. The growth in the service economy is widely recognized and in-creasingly contributes to the economic development of many regions. Services are diverse and often been difficult to de-fine. Most frequently, a service has been described as an act, a process and a performance. Services are also defined as economic activities that create “added value” and provide benefits to customers. In the past, selling products are separate from selling service. When consumers bought food, clothes or car, they simply bought the tangible things they wanted and did not have any added value. Since the competition is stronger and fiercer, it’s hard to separate product from its service. If companies only sell their goods to customers without any attached services, they will lose their customer easily and failure is inevitable. For example, when buying computer, they might be attracted by the store where looks professional and they can get full in-formation as well as guidance from helpful staff about prod-ucts, a hotline service for installing the programs and so on. Company must pay attention to it and invest more on distri-bution channel to provide more good service to customers. Service business offers intangible value to buyers rather than tangible goods. It includes a wide range of industries such as hospitality, tourism, art, healthcare, education and so on. “Some service such as charities, arts operate in......

Words: 2294 - Pages: 10

Product, Pricing and Channels Paper

...Product, Pricing, and Channels Paper Agavni Saakyan, Amanda Tate, Andrea Nunes De Moraes, Angelita Onate, Aquintas Bradley, Nicole Bentley MKT/ 421 July 14, 2014 The Life Skills Center offers a variety of products and services for individuals and families in need. These services allow an individual to better opportunities to advance themselves and overcome addictions. A person or family in need can come to the center to obtain their GED, obtain help with job hunting and interviewing techniques. We also offer more detailed programs such as counseling and addiction programs to help those in need make better choices for not only themselves but their families. Having a center that offers a variety of services gives someone in need options to make better choices. Our client’s needs will be solved in a variety of ways. A potential client could come to the center and enroll in our addiction program. This program will help this individual overcome their problems and open their eyes to new opportunities and possibly a new life. These opportunities can also be worked upon within the center. Once their addiction program comes to an end, they can seek a new opportunity; such as obtaining their GED. Taking this first step allows so many other doors to open for them to become a better person and get back to contributing in the workforce and society. Once the GED program is completed, the life skills center will help them channel their interest in careers, look for a career and...

Words: 1908 - Pages: 8

Product, Pricing, and Channels Paper

...Product, Pricing, and Channels Paper H&M online Since 2009 there has been a large decrease in offline retail sales, by 2015 Gap Inc. will be closing 189 store, Abercrombie and Fitch is planning to close 180 store and Aeropostale 175 stores (Business Insider). JCPenny’s store sales alone dropped 31.7% in store purchases (Business Insider). Where are consumers going? Online. In 2013, the top online purchases for U.S. consumers were consumer electronics, books, clothing and apparel, 63% customers prefer to purchase clothing and apparel online. Ecommerce is one of the fastest growing markets in the world. Currently the United States is the largest online retail market. Based on the statistical data, retail e-commerce back in 2012 reached 225.5 billion U.s dollars in sales and projected to grow to 434.2 billion U.S. dollars by 2017 (Known, Statistics). “Goldman Sachs predicts that in North America alone, a quarter of clothing sales will take place on the internet by 2030, up 7 percent from 2011” (NY Daily). With anticipation H&M is proposing to launch its online retail market to the United States. An online market will have a great impact, but there are several challenges facing retailers in launching an online market. Online markets have a great impact on profit margins, because of high shipping cost and the cost of returning items. “You don’t want to lose out on being the port of call for younger shoppers. So H&M should really get in there, “Isabel Cavill, Planet......

Words: 1377 - Pages: 6

Pricing Services

...Basic four strategies of service. Service firms vary widely in their abilities to serve different types of customers well. Hence rather than trying to compete in an entire market,each company needs to focus its efforts on those customers it an serve best. The extent of a company’s focus can be described along two dimensions: market four and service focus Market focus is the extent to which a from serves few or many markets, while service focus describes the extent to which a firm offers few or many services Fully focussed - A fully focussed organisation provides limited range of services (perhaps just a single core product) to a narrow and specific market segment. Developing recognized expertise in a well-defined niche may provide protection against would- be competitors and allows a firm to charge premium prices Disadvantage - The biggest risk of the fully focussed strategy is that the market may be too small to get the volume of business needed for financial success other risks of the fully focused strategy include the danger that demand for the service ay decrease because of alternative products, new technologies offered by other providers or that purchasers in the chosen segment may be affected by an economic downturn example - a) hospitals that operate only cataract or limb replacement (jaipur legs……. b) a popular newspaper (deccan ) which sells only news paper Market focussed - (Narrow market but wide range of services) A market focussed company...

Words: 1491 - Pages: 6

Product, Pricing and Channels

...Product, Pricing and Channels The Royal Caribbean Navigation app is only available for users of android and Apple devices. The app is free to download and is able to connect on all RCL guest using Royal Caribbean Wi-Fi networks. The Royal Caribbean navigation app connects to the ship networks in the port terminal as well. The Wi-Fi network is complimentary only if Royal Caribbean guest use it to access the app while the mobile device is on “airplane mode”. The Royal Caribbean navigation app complies with mobile device settings, so therefore within the app it allows the guest to change the settings to airplane mode. The Royal Caribbean app brings excitement to all guests with the wonderful countdown feature. The app allows the user to enter their plan vacation date, and the app will store the information to countdown to the scheduled vacation. The Royal Caribbean navigation app countdown minutes, hours, and days. With a simple tap of your smart device, Royal Caribbean navigator app permits guest to information regarding characters, deck parties, dining, entertainment, live shows, nightclubs and lounges, ports of call, spa services, shopping, youth clubs. The best part of the Royal Caribbean navigator app is the guest locator. Royal Caribbean guest are able to locate other guest in their group, which also have the app devices. Royal Caribbean guest is able to view what is happening every minute of every day. The Royal Caribbean navigator app syncs with the devices calendar......

Words: 1858 - Pages: 8

Products, Pricing and Channels

...Products, Pricing, and Channels Introduction The all-new Mustang is the next chapter in the life of one of the world’s most iconic cars. The 2015 Ford Mustang is loaded with innovative technologies and delivers high levels of performance and style. “The Mustang is the first car to offer four, six, and eight-cylinder engines that each produces at least 300 horsepower. With more powertrain options to choose from, there is a Mustang to fit any lifestyle. The 3.7-liter V6 and upgraded 5.0-liter V8 are joined by an all-new 2.3-liter Eco Boost engine that brings state-of-the-art technology to Mustang.” (Ford, 2014) Description & Features The Mustang’s Eco Boost engine uses direct injection, variable cam timing and turbocharging to deliver plenty of usable performance across a broad RPM range. Mustang is equipped with over 300 horsepower and 270 lb.-ft. of torque on tap from the standard 3.7-liter V6, even the most accessible Mustang delivers the performance customers expect. Drivers will appreciate smoother shifts from the updated manual gearbox while a reworked automatic transmission features new steering wheel-mounted shift paddles for drivers who want the choice between convenience and control. (Ford, 2014) There are several key design features that define the all-new Mustang, including, a lower, wider stance with a reduction in roof height, and wider rear fenders and track. The return of Mustang fastback with a sleeker profile enabled by more steeply sloped......

Words: 2168 - Pages: 9

Product, Pricing and Channels

...Product, Pricing and Channels Esan Williams, Mark Jernigan, Ann Groose, Maria Fonseca, Brent Beley, Ariana Zamarripa, Bernita Miller and Tammy Housie MKT/421 June 9, 2014 Thomas O’Brien Product, Pricing and Channels In this paper, team C will discuss a gluten-free menu item at Subway and how it solves the current need in the target market. It will include strategies on how to attract the target market through correct appeal, quality, and pricing. Pricing is very important because it is something that determines how much your product is worth. There are two well-known pricing strategies, penetration and skimming. Also, important is the product lifecycle, how long will it stay on the current subway menu? In terms of packaging for the new item, will it be different? Or will it use the current packaging that is offered at the restaurant? Another topic discussed in the paper will be the channels of distribution for the new gluten-free product. Detailed Description of Subway Gluten-Free Menu Item Subway has opened more than 22,000 global locations, in the United States Subway is the largest fast-food chain and its franchises can be found worldwide in 77 countries. It became famous as the healthy choice in fast foods through the story of Jared Fogle, a Indiana University College student who claimed to have dropped 245 pounds from eating Subway sandwiches with six grams of fat or less, low-fat chips, and diet drinks. Subway continued to improve its healthy food choice...

Words: 1828 - Pages: 8

Starbucks: Product, Pricing, and Channels

...Starbucks - Product, Pricing, and Channels MKT/421 Introduction According to Boyer (2014) Starbucks is a global organization that has the responsibility of more than 70,000 outbound deliveries a week to retail stores, distribution channels and outlets worldwide. Keeping Starbucks products flowing from suppliers to customers is a complex exercise that spans across nineteen countries. This is a review of Starbucks; product, pricing, and channels of distribution. The Product Starbucks Corporation offers two new types of drinks, with three distinct flavors, to their wide assortment of products. The new lines of drinks are Starbucks Refreshers, a refreshing twist on an old favorite. The flavor choices were carefully chosen based on the fruit flavor's popularity, as well as to add to the drinks existing taste. The first new drink in the Refreshers line is a coffee based beverage. The coffee Refresher's base is made from Starbucks' decaf Pike Place Roast. The base of this beverage's nutritional value includes: five calories, no fat, no sodium, and one gram of protein (Starbucks Corporation, 2014). To make this beverage the new Refreshers line, delicious fruit syrup is added to the coffee. Customers may choose between three flavors, Mango Passion, Acai Berry Blend, or Honey Lemon. Each fruit syrup adds one full serving of fruit to the beverage, helping customers meet their daily nutritional needs. The second drink's base is a Chai Brewed Tea. This beverage on its own......

Words: 1931 - Pages: 8

Product Pricing

...Product Pricing and Channels Penny Rea-Bailey and Melony Parks MKT 421 September 22, 2014 Rhonda Vroman Product Pricing and Channels McDonald’s is featuring a new McTurkey Burger. The new burger will have fewer calories for those that are wanting a healthier choice. Ground turkey is a leaner choice than beef. The idea is to keep the calorie count around 450. The target markets needs will continue to be met with a low calorie, great tasting burger at an affordable price. To ensure the success of the burger, the marketing team will stay abreast on the marketing efforts and make adjustment where needed throughout the product life cycle. Another area we will focus on for our marketing target is the well-known branding that McDonald’s uses on all their packaging. The pricing strategy is in line with other products that are sold globally as well as in line with those of our competitors. We will continue with the same channels of distribution, starting distribution to our consumers in the United States. We will also use TV, billboards, magazines, Internet, and major event sponsorship. Features of Product The McTurkey burger is designed to be a calorie smart sandwich which would be a moist turkey patty cushioned between two whole wheat buns, with the traditional condiments; lettuce, tomato, onion, and McDonald's secret sauce. In the United States currently there is more than 1/3 (34.9% or 78.9 million) obese adults (CDC, 2014). The fast food industry continues to......

Words: 1488 - Pages: 6

Portion Product Pricing

...Product, Pricing, and Channels Paper Davy Ferguson, Antoinette Gardner, Adrienne Howard, Nancy Rooke, Taivonti Savage MKT/421 May 12, 2015 Dr. Christopher Whitaker Product, Pricing, and Channels Paper Meeting the Needs of the Target Market Duende is an athletic apparel company focusing on the growing demand for fashionable, functional active wear. There is a large market for the products currently offered by Duende and consumers are looking for athletic apparel in new fabrics and bright colors which broadens the scope for even more products to join the Duende product line. Today, Duende offers products such as running shoes, backpacks, hats, sunglasses, socks, protective gear, fitness devices, and yoga apparel. Duende’s research and development group is constantly surveying the market to stay in touch with latest trends. Active wear is especially appealing to those who are interested in a healthier lifestyle. Duende’s offers a product line geared toward the gym-minded professional who is interested in clothing that is comfortable and also motivational. A pair of super cute leggings works for the gym and also transitions well into the after gym trip to the grocery store. Some of our customers will purchase our products to use as leisure wear. Our customers will wear our products because they feel good, look good, and make them feel good about themselves even if they do not plan to go to the gym today. Duende offers this functionality at an affordable price. ...

Words: 1986 - Pages: 8

Product, Pricing, and Channels Paper

... Product, Pricing, and Channels Paper Charles Butler, April Molley, Jon Walter, and William Stewart MKT/421 Marketing April 6, 2015 Anil Agarwal Features of the Apple Watch and the Needs of Target Market This product is one of the best ideas invented since the tablets hit the market. You now have a cell phone, tablet, and your wallet all in one on your wrist. The benefits from this product will help many Americans keep better track of their health, personal information, and communication. The reminders and schedules are going to be more visible to the eyes. No need to look at your cell phone to see who is calling or sending a text both devices will be sync together. The Apple watch is created with the function that you will be able to use Apple pay to pay for purchases everywhere. One of the best features that are going to be very helpful is the fitness activity app. The Apple watch is designed to learn your daily activity and then turn that into ways to improve your physical health. It will suggest personalized all-day activity goals also provide reminders when to do them and when there has been no activity in a while. Apple Watch tracks movement, estimates calories burn, and monitors heart rate and will sync your information through the application to your Apple IPhone (Apple, 2015). So it is like having a personal trainer by your side all day to help with keeping you on the track of your goals. Some......

Words: 2013 - Pages: 9

Pricing of Services

...Defined as the friendly reception andHow do we define Hospitality? treatment of guests or strangers; the quality of receiving and treating guests and strangers in a warm, Derived from thefriendly way French word Hospice: to provide for the weary; to take care of those India: “The guest is Many cultures embrace hospitality travelling South Central Asia / Middle East: People are oftenGod” principal characterized by an ancient set of ethics, the first of which is Celts: A host who granted a person refuge not onlyhospitality provided food and shelter, but protection while under their roof 4. Service vs Hospitality Service Technical Efficiency:Hospitality Holding a glass by the stem Intangible Felling of Warmth Serving food to the left and clearing Sincere Smiles Handling guest needs with heartfelt dishes from the right Delivering guests’ bags to theirconcern room Vocal Tone “Service is delivering on your promise. Hospitality is making people feel good while you’re delivering on that promise.” – Danny Meyer 5. Cruising Lodging IndustryMany Facets of the Hospitality Industry Recreation and Attractions Tourism Restaurant IndustryIndustry Meetings, Conventions, Events and Gaming and EntertainmentClubs Expositions ...

Words: 344 - Pages: 2

Product, Pricing, and Channels

...Product, Pricing, and Channels MKT/421 August 24, 2015 Product, Pricing, and Channels The target group for Apple Music (Beats 1 radio) is any consumer that uses iTunes and is willing to purchase legal music ("",2015). There has been a decline in music downloads and sales through iTunes, so this is Apple’s way to revamp a product they already have. Apple Music could be appealing to college students, teenagers, businesspersons, and families. These customers are always on the go and if music is something that is essential to their lifestyle this new Apple music will be very beneficial for them. Apple Music allows users to mix and match their playlist with streaming music from the Internet ("",2015). So this means that the user can have an endless music supply at their fingertips. The App can find music that matches what the customer may already have on their device and create a custom music playlist for them. This feature creates a wide variety of music that the member may not have heard yet and can introduce them to a new artist. With a paid Apple Music subscription, members will have access to a variety of interactive features such as: unlimited skips, utilization of the "like" function, commenting abilities, play and save function, connect content function, access to entire Apple Music catalog, add songs to personal library function, listen to music offline, and have all music on device uploaded to iCloud ("", 2015). After the......

Words: 2033 - Pages: 9

Product Pricing

...Product, Pricing, and Channels Paper MKT/421 Marketing Tierron Madden, Jacquelyn Her, Michael Highfill and Evan Strick April 05, 2015 Creig Foster The future of electronics are changing, and there are many electronics that have one or another function. It is the one product that a customer look for that can do everything. The newest product will change how we wear and interact with our electronics. It is the beginning of all the possible things that customers can do by wearing a product. Product Features and Target Market Needs Apple watch has multiple services that will make their customers happy and be able to stay in touch with everything conveniently. There are more than one watch to choose from, which will help each customer wanted one that meet their needs (Apple Inc., 2015). A company that have options are important because it allow their customers to have a choice in what they want versus not having any choice. Apple watch lets customers interact and navigate wearing a smaller device to wear around your wrist, but work just like an iPhone or a Mac computer (Apple Inc., 2015). The Apple watch has a retina display that will provide a better quality image, unlike other watches and recognize a simple touch to open up applications (Apple Inc., 2015). This will help customers who do not have smartphones wear something they are used to such as a watch and give them the same experience as those who have a smartphone. Apple Watch has also included...

Words: 2190 - Pages: 9

Product and Pricing Strategy

...Assignment #4: Product and Pricing Strategy Maria Vetter Marketing Management – MKT 500 Dr. Stephen R. Hiatt March 6, 2010 Product and Pricing Strategy Components of the Product Strategy: Branding Important components of product strategy begin in the branding stage. Here, one should consider the following questions; why do consumers value brands? What is the cause for an organization or consumer to purchase a particular product over another product? Moreover, why are consumers willing to spend more for a particular product over another based on a brand name? The answers are simple. Consumers and organizations buy brand name products based on expectations of quality, reduced risk, and the prestige of owning the brand named product. (Winer, 2007) However, the term brand is a complex concept that is mainly due to the multidimensional components of a brand name. Additionally, the number of different branding concepts adds to the complexity of brand aspects. However, for such a complex idea, the concept branding can be minimized to a mere five categories of brands. First, is corporate brands; such as, JP Morgan. Here, the company name is simultaneously brands with meaning to consumers. Secondly, there are corporate parent brands; “These are brand names where the corporate brand is carried......

Words: 1631 - Pages: 7