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MARKETING CHANNELS

MARKETING CHANNELS. Pricing Strategy Berman Chapter 9 Version 3.0. A. Introduction B. Price vs Non Price Competition C. Pricing Objectives D. Overall Pricing Strategy E. Cost-Oriented Pricing F. Demand-Oriented Pricing G. Competition-Oriented Pricing H. Integrated Pricing

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MARKETING CHANNELS

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  1. MARKETING CHANNELS Pricing Strategy Berman Chapter 9 Version 3.0

  2. A. Introduction • B. Price vs Non Price Competition • C. Pricing Objectives • D. Overall Pricing Strategy • E. Cost-Oriented Pricing • F. Demand-Oriented Pricing • G. Competition-Oriented Pricing • H. Integrated Pricing • I. Pricing policies • J. Gray Markets • K. Adapting Price Strategies • L. Legal Aspects

  3. A. Introduction • B. Price vs Non Price Competition

  4. C. Objectives • sales based • profit based • gross margin, return on investment • status quo based • D. Overall Pricing Strategy • cost approach • demand approach • competition approach

  5. E. Cost - Oriented Pricing • markup pricing • at retail, at cost • variable markup policies • planned initial markup percent by retailers • direct product profitability • winners - dogs, sleepers - traffic builders • sources of gross margin data • Robert Morris Associates • Dun and Bradstreet Annual Statement Studies • Progressive Grocer Annual Report • small samples, different years and geogs

  6. F. Demand-Oriented Pricing • demand minus, chain markups • G. Competition-Oriented Pricing • competitive bidding • H. Integrated Approach to Pricing Strategy

  7. I. Determining Pricing Policies • High, Low Pricing • forward buying, trade loading • Every Day Low Pricing EDLP • J. Gray Market Goods • domestic vs foreign • parallel vs diverted • Risks of Gray market • free rider phenomenon

  8. Strategies to limit gray marketing • Identify firms that have resold to gray resellers • Set quantity discounts schedule and price strategy by market to reduce transshipping • differentiate products sold to different markets • develop customer awareness of risks with transshipped goods • Develop an MIS to monitor above average purchase levels by companies • Price Guarantees • Selling Against the Brand

  9. K. Adapting the Price Strategy • additional discounts, markups • L. Legal Aspects of Pricing • resale price maintenance • state sales-below-cost laws • gray market goods • price discrimination • Robinson Patman • Discounts and Terms • availability rule

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