Country of Origin Effects on Marketing
February 12, 2025
International Retailing and branding has been one of the sectors that is seeing exponential growth. With increase in standard of living and disposable income, people in developing countries are getting exposed to international brands. Rise of internet and multi-media has further provided impetus to the dream of people to aspire for branded consumer goods. Along […]
One of the positive effects of the rapid globalization is the increasing awareness amongst people and society about ethical and moral as well as environmental issues. While political leaders and global organisations as well as scientists are concerned about global warming and loosing energy crises, we see the birth and rapid growth of green earth […]
Introduction: The Effect of the Downturn and How Companies Can Cope The ongoing global economic crisis has impacted most of the companies in the world as they have to not only reckon with falling sales, stagnating demand, oversupply, and inflation all at the same time mean that businesses are operating in “chaotic” and “uncertain” environments. […]
Consumer Behaviour refers to the study of buying tendencies of consumers. An individual who goes for shopping does not necessarily end up buying products. There are several stages a consumer goes through before he finally picks up things available in the market. Various factors, be it cultural, social, personal or psychological influence the buying decision […]
Internet has given way to new means of communication and interaction between people situated across the globe, breaking down the barriers of distance, time and borders. Technology has made it possible for people not only to talk to one another, but participate in a lot of activities together as a group. Thus group activities or […]
Marketing mix for companies comprises of 4 Ps Product, Price, Place and Promotion. Price is directly related to bottom-line of any business. Profitability of product is required for future operation of the company. Price strategy should communicate to the customer the value company is providing.
There is in-numerable price related challenges in the market for companies. Furthermore, with the advent of internet customer awareness for pricing information has improved. Sites like Priceline and eBay are encouraging customer to name their price for products as well as services.
Pricing strategy is dynamic in nature and should reflect changing condition in competition as well as the market. Overall price strategies follow six step model:
Companies need to plot the demand curve with respect to price as to understand price sensitivity. This demand curve can be estimated using statistical methods by analyzing historical data or by perform price related experiments to understand what customers are willing to pay or through market research and putting the question directly to the customer.
Generally, it is observed that production level increase cost per unit decreases owing to the learning curve effect which comes through experience. Activity based costing is getting in prominence as to allocate the cost properly which helps in estimation profit correctly.
Another way of cost setting is through the target costing, made famous by Japanese companies. In target costing companies set price and profit level. After which they concentrate on cost as to maintain the profit level.
Perceived value pricing method talks about setting price based on the perceived value in consumer price and companies ability to deliver that value.
In value pricing method, companies charge lower price for high quality product from loyal customers. This method is usually seen in the super market. Auction type pricing, going rate pricing and group pricing are other pricing methods.
Pricing should adapt to factors like geographical location, market segment and economic conditions. Companies should remain flexible towards pricing policy and change as per market dynamics. Companies should also not react blindly to price change by competition rather should focus on analyzing the underlying motives.
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