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Pricing strategies that would make sense for the company's positioning and targeting strategy (Essay Sample)

Instructions:
Review the pricing strategies described in the background readings. Given the company's positioning and targeting strategy Which of those pricing strategies would make sense? Why? (Be sure to reference the background materials below.). (2) Discuss the role of discounts in this company's strategy. What would you advise the company in terms of discounts and specials? (3) Briefly explain the distribution strategy for this product. How does it fit with the designated target market? Is there an incongruity with the store or other outlet? In other words, does the distribution seem to fit the product's target as well as harmonize with other elements of the marketing mix? (4) Now refer to the brand extension. For instance, suppose ALPO created a new food for large dogs - a dry form and a canned form. Would the company need to modify its pricing and distribution strategies? What would be changed and what would stay the same and why? Write your answers in a memo - 550 words approximately Background Reading: Pricing: Anonymous. Pricing. USC Marshall School. http://www(dot)consumerpsychologist(dot)com/intro_Pricing.html Distribution: http://www(dot)consumerpsychologist(dot)com/intro_Distribution.html Also required: Bertini, Marco, and Luc Wathieu, How to Stop Customers from Fixating on Price. Harvard Business Review Vol. 88 (May), p. 84-91 Berk, Christina Cheddar (2011 March 7). Here Comes the Bride, All Dressed by Costco. CNBC Available on 2011 March 8 at http://www(dot)cnbc(dot)com/id/41950692 RECOMMENDED: Florissen, Andreas; Maurer, Boris; Schmidt, Bernhard; & and Vahlenkamp, Thomas (2001, August). The race to the bottom: When industries deregulate, their managers face unfamiliar challenges. Price wars are often the unfortunate—and unnecessary—result. McKinsey Quarterly. McKinsey & Company. Rafi, Mohammed Ditch the Discounts. Harvard Business Review; Jan/Feb2011, Vol. 89 Issue 1/2, p23-25, 3p, 2 Color Photographs http://search(dot)ebscohost(dot)com/login.aspx?direct=true&db=bth&AN=56696805&site=ehost-live source..
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Running head: MARKETING
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Pricing strategies that would make sense for the company’s positioning and targeting strategy.
The company should adopt pricing strategies that would allow it to achieve its set pricing objectives. The company set prices to enable it earn revenue, win more customers, enable the product to be well positioned and enable it sustain the high competition in the market. Everyday low price strategy will be effective for the company as it will enable it to win more customers. Most consumers are price oriented and they will go for the products which are cheap. Also with high competition in the market, this pricing strategy will attract more consumers leading to more revenues thus out doing the other companies (USC Marshall, n.d (b)).
The skimming strategy will also prove effective as relates to the positioning of the company. Consumers are interested in getting the new product in the market despite the price. This will allow the company to make more sales in the begging, receive more consumers thus out shinning the other companies. The high prices paid in the early periods will allow the company to earn higher revenues. When the company reduces prices in the later stages it will earn higher revenues from the many customers it would have retained. So long as the product is good to the consumers they will stick to it (USC Marshall, n.d. (b)). However, this strategy is risky as new competitors might come in during the high pricing. The company needs to use the high price for shorter period when the consumers still have the interest of testing the new product.
The role of discount in the company...
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