Table of Content

Academy Certificate
Declaration
Acknowledgement
Preface

CHAPTER- 1 Introduction
CHAPTER- 2 Industrial/Company Profile
CHAPTER- 3 Research Methodology
Abstract
Objective
Research Design
Area of Sample
Sample Selection
Questionnaire
CHAPTER- 4 Analysis & Interpretation
CHAPTER- 5 Finding/Conclusion/ & Suggestion

Bibliography

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 DECLARATION

I hereby declare that this project report titled “A Study on Pricing Strategy of Shine

City with Reference to Mirzapur.” has been submitted by me for the award of

certificate. This is result of original work carried out by me. This report has not been

submitted anywhere else for the award of any other internship Certificate.

Date : Jai Prakash

ACKNOWLEDGEMENT

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I Sincerely want to thank all the people helped me throughout the procedure of my

survey report. It really has been a learning experience for me.

I would also like to thank Mr. B.N. Singh, my supervisor at GBAMS and staff for

giving me their precious time and for the guidance and he/she directed me

whenever I was in need of it. I am highly obliged for his/her assistance.

I would also like to appreciate the help given by the all faculty of GBAMS for

giving their valuable time sharing their experience with us, with their valuable

practical experience of their working life.

Jai Prakash

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 Chapter 1

Conceptual Background

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 Pricing Strategy
Introduction :
One of the four major elements of the marketing mix is price. Pricing is
an important strategic issue because it is related to product positioning.
Furthermore, pricing affects other marketing mix elements such as
product features, channel decisions, and promotion. Price is the one
element of the marketing mix that produces revenue; the other elements
produce costs. Prices are perhaps the easiest element of the marketing
program to adjust; product features, channels, and even promotion take
more time. Price also communicates to the market the company's
intended value positioning of its product or brand. A well-designed and
marketed product can command a price premium and reap big profits.
Motivation :
Developing strategy is one thing-managing the change process to embed
that strategy in the organization is quite another. The truth is that
implementing effective pricing strategy involves changing the
expectations and behaviors of all of the actors involved in the sales
process.
Customers must learn that they will be treated fairly and that abusive
purchase tactics will not be rewarded with ad hoc discounts. Sales must
learn that they will be rewarded for closing deals that increase firm
profitability rather than using price as a tactical lever to increase sales
volume. Finance must learn to look beyond cost as a determinant of
price to better understand the tradeoffs between price, cost, and market
response. ―Financial incentives are, without question, one of the most
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 powerful levers for behavioral change among salespeople.‖

What a price should do :

A well chosen price should do three things:
Achieve the financial goals of the company (e.g., profitability)
Fit the realities of the marketplace (Will customers buy at that
price?)
Support a product's positioning and be consistent with the other
variables in the marketing mix price is influenced by the type of
distribution channel used, the type of promotions used, and the
quality of the product
Price will usually need to be relatively high if manufacturing is
expensive, distribution is exclusive, and the product is supported by
extensive advertising and promotional campaigns
A low price can be a viable substitute for product quality, effective
promotions, or an energetic selling effort by distributors
From the marketers point of view, an efficient price is a price that is very
close to the maximum that customers are prepared to pay. In economic
terms, it is a price that shifts most of the consumer surplus to the
producer. A good pricing strategy would be the one which could balance
between the price floor(the price below which the organization ends up in
losses) and the price ceiling(the price beyond which the organization
experiences a no demand situation).

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 Pricing Strategy

Understanding Pricing
Price is not just a number on a tag or an item : Price is all around
us. You pay rent for your apartment, tuition for your education, and a
fee to your physician or dentist. The airline, railway, taxi, and bus
companies charge you a fare; the local utilities call their price a rate;
and the local bank charges you interest for the money you borrow. The
price for driving your car on Florida's Sunshine Parkway is a toll, and
the company that insures your car charges you a premium. The guest
lecturer charges an honorarium to tell you about a government official
who took a bribe to help a shady character steal dues collected by a
trade association. Clubs or societies to which you belong may make a
special assessment to pay unusual expenses. Your regular lawyer may
ask for a retainer to cover her services. The "price" of an executive is a
salary, the price of a salesperson may be a commission, and the price of
a worker is a wage.
Finally, although economists would disagree, many of us feel that
income taxes are the price we pay for the privilege of making money.
Throughout most of history, prices were set by negotiation
between buyers and sellers. "Bargaining" is still a sport in some areas.
Setting one price for all buyers is a relatively modern idea that arose
with the development of large-scale retailing at the end of the
nineteenth century.
F. W. Woolworth, Tiffany and Co., John Wanamaker, and others
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advertised a "strictly one-price policy," because they carried so many
items and supervised so many employees.
Today the Internet is partially reversing the fixed pricing trend.
Computer technology is making it easier for sellers to use software that
monitors customers' movements over the Web and allows them to
customize offers and prices. New software applications are also allowing
buyers to compare prices instantaneously through online robotic
shoppers. As one industry observer noted, "We are moving toward a very
sophisticated economy. It's kind of an arms race between merchant
technology and consumer technology.
Traditionally, price has operated as the major determinant of
buyer choice. This is still the case in poorer nations, among poorer
groups, and with commodity-type products. Although nonprice factors
have become more important in recent decades, price still remains one
of the most important elements determining market share and
profitability. Consumers and purchasing agents have more access to
price information and price discounters. Consumers put pressure on
retailers to lower their prices. Retailers put pressure on manufacturers
to lower their prices. The result is a marketplace characterized by heavy
discounting and sales promotion.

How Companies Price :

Companies do their pricing in a variety of ways. In small
companies, prices are often set by the boss. In large companies, pricing
is handled by division and product-line managers. Even here, top
management sets general pricing objectives and policies and often
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approves the prices proposed by lower levels of management. In
industries where pricing is a key factor (aerospace, railroads, oil
companies), companies will often establish a pricing department to set or
assist others in determining appropriate prices. This department reports
to the marketing department, finance department, or top management.
Others who exert an influence on pricing include sales managers,
production managers, finance managers, and accountants.
Executives complain that pricing is a big headache—and one that
is getting worse by the day. Many companies do not handle pricing
well, and throw up their hands at "strategies" like this: "We determine
our costs and take our industry's traditional margins." Other common
mistakes are: Price is not revised often enough to capitalize on market
changes; price is set

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 Pricing Strategy

independently of the rest of the marketing mix rather than as an intrinsic

element of market- positioning strategy; and price is not varied enough
for different product items, market segments, distribution channels, and
purchase occasions.
Others have a different attitude: They use price as a key strategic
tool. These "power pricers" have discovered the highly leveraged effect of
price on the bottom line. They customize prices and offerings based on
segment value and costs.
The importance of pricing for profitability was demonstrated in a
1992 study by McKinsey & Company. Examining 2,400 companies,
McKinsey concluded that a 1 percent improvement in price created an
improvement in operating profit of 11.1 percent. By contrast, 1 percent
improvements in variable cost, volume, and fixed cost produced profit
improvements, respectively, of only 7.8 percent, 3.3 percent, and 2.3
percent.
Effectively designing and implementing pricing strategies requires
a thorough understanding of consumer pricing psychology and a
systematic approach to setting, adapting, and changing prices.

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Price

Supply

Demand

Quantity

Fig : Graph showing how the supply and demand for the goods
generally affects prices

Because there is a relationship between price and quantity demanded, it

is important to understand the impact of pricing on sales by estimating
the demand curve for the product. For existing products, experiments
can be performed at prices above and below the current price in order to
determine the price elasticity of demand. Inelastic demand indicates that
price increases might be feasible.

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Pricing Strategy

Pricing in Competitive Markets :

Law of Demand: all other factors being the same, higher prices will lead
to lower quantities being demanded.

Price Elasticity of Demand(e) = % change in Quantity Demanded /

% change in Price. Break Even Point: Point of zero profits, i.e., TR
= TC.
BEP Quantity: F/[P - UVC]

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Page 13
 Pricing Strategy

Consider this matrix:

There are many ways to price a product which have been discussed in
detail in the paper.

Premium
Pricing.
Penetration
Pricing.
Economy
Pricing. Price
Skimming.
Psychological
Pricing. Product
Line Pricing.
Optional Product
Pricing. Captive
Products Pricing .

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 Product Bundle
Pricing.
Promotional
Pricing.
Geographical
Pricing. Value
Pricing.

A successful pricing strategy must be built on a solid analytical

foundation which goes well beyond high-level customer values or
competitive anecdotes. It requires quantified models of customer
decision-making, competitive economics, and segmented internal
economics.

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 Pricing Strategy

Common pricing mistakes :

Pricing is too cost oriented. Companies do not take enough
account of the overall market demand and consumer psychology.
Prices are not revised often enough to take advantage of
changed conditions in the marketplace.
Prices are set independently of the rest of the marketing plan.
Prices are not varied enough for different product items
and market segments. Prices are set to match or better a
competitor without justification or analysis.

Objectives in Setting Price :

• Increase profits
– Attract new customers
– Maintain current customers

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 – Increase profit per customer
– Introduce new product
• Generate cash
• Improve ROI

How to Attract New Customers :

• Introductory coupons / discounts
– provide incentive
– maintain reference price
• Trial offers
– increase familiarity
– reduce risk
• Problem
– perceived as unfair

Maintain Current Customers :

• Meet competition

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 Pricing Strategy

– matching prices
– add to bundle (as long as customers want it!)
• Create barriers to exit
– contracts / subscriptions
– automatic billing
– phone numbers (no longer in the U.S.)
– family plans
• Provide loyalty programs
– frequent flyer
– Starbuck cards

Increase Profit per Customer :

• Increase prices
– reduce product? (candy bar pricing)
– justify/ notify / base on costs
• Adjust product mix
– sales incentives for more profitable business
• Adjust customer mix
– teenagers vs. seniors
• Charge for extras
– what’s valuable to customer and cheap to company
• Get money up front

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– Prepaid subscriptions

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 Pricing Strategy

CONCERNS IN SETTING PRICE : 4C’s

Competition Customer
Cost Custom

PRICING MODELS :
• Cost-based Pricing
• Value-based Pricing
• Flat-Rate Pricing
• Ala-Carte Pricing
• Two-Part Pricing
• Peak Load / Congestion Pricing
• Dynamic Pricing

Cost-based vs. Value-based

Cost Based Value Based

1. Most Common pricing method 1. Optimal Profits

2. Easiest Pricing Method 2. Requires Research
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 3. Considered Fair 3. Complicated to administer
4. Difficult to allocate fixed costs 4. Can be considered unfair
5. Sub-optimal Profits

Flat-Rate Pricing

• Single rate per time period:

– PROS:
• provides unlimited use
• increases use
• simple to explain & bill
• popular with customers / low risk
– CONS:
• difficult to predict average price
• unfair in that some people subsidize others
• fair in that charges are predictable

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 Pricing Strategy

Ala-Carte Pricing

Variable rate depending on use:

– PROS:
• considered fair
– greater choice
– greater control
– CONS:
• more difficult to explain
• more difficult to bill
• more risk

Two-part Pricing I

Combines flat rate plus variable:

, monthly fee plus cost per minute (declining?)

– PROS
• spreads costs more fairly
– CONS
• perceived as hassle
• unpredictable
Two-Part Pricing II

Combines down-payment & flat rate per month:

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 – PROS:
• covers fixed costs immediately
• spreads customer’s costs
• fits customer’s monthly budget
• generates financing revenues
• predictable / low risk
– CONS:
• increases total cost to customer
• requires long-term billing

Peak Load / Congestion Pricing

Variable rate depending on time of day or week:

– PROS:
• spreads use
• encourages use in unpopular time
• considered fair
• easy to explain
– CONS:
• difficult to bill

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 Pricing Strategy

Dynamic Pricing

Variable rate for each customer:

– PROS:
• maximizes profit per customer
– CONS:
• difficult to implement
• requires detailed demand schedule
• difficult to explain
• considered unfair

Consumer Psychology and Pricing

Many economists assume that consumers are "price takers" and

accept prices at "face value" or as given. Marketers recognize that
consumers often actively process price information, interpreting prices
in terms of their knowledge from prior purchasing experience, formal
communications (advertising, sales calls, and brochures), informal
communications (friends, colleagues, or family members), and point-of-
purchase or online resources. Purchase decisions are based on how
consumers perceive prices and what they consider to be the current
actual price—not the marketer's stated price. They may have a lower
price threshold below which prices may signal inferior or unacceptable

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quality, as well as an upper price threshold above which prices are
prohibitive and seen as not worth the money.
Understanding how consumers arrive at their perceptions of prices
is an important marketing priority. Here we consider three key topics—
reference prices, price-quality inferences, and price endings.
REFERENCE PRICES

Prior research has shown that although consumers may have fairly
good knowledge of the range of prices involved, surprisingly few can
recall specific prices of products accurately. When examining products,
however, consumers often employ reference prices. In considering an
observed price, consumers often compare it to an internal reference price
(pricing information from memory) or an external frame of reference
(such as a posted "regular retail price").
All types of reference prices are possible. Sellers often attempt to
manipulate reference prices. For example, a seller can situate its product
among expensive products to imply that it belongs in the same class.
Department stores will display women's apparel in separate departments
differentiated by price; dresses found in the more expensive department
are assumed to be of better quality. Reference-price thinking is also
encouraged by stating a high manufacturer's suggested price, or by
indicating that the product was priced much higher originally, or by
pointing to a competitor's high price.
Clever marketers try to frame the price to signal the best value
possible. For example, a relatively more expensive item can be seen as
less expensive by breaking the price down into smaller units. A $500
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annual membership may be seen as more expensive than "under $50 a
month" even if the totals are the same
When consumers evoke one or more of these frames of reference,
their perceived price can vary from the stated price. Research on
reference prices has found that "unpleasant surprises"—when perceived
price is lower than the stated price—can have a greater impact on
purchase likelihood than pleasant surprises.

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 Pricing Strategy

PRICE-QUALITY INFERENCES
Many consumers use price as an indicator of quality. Image pricing
is especially effective with ego-sensitive products such as perfumes and
expensive cars. A $100 bottle of perfume might contain $10 worth of
scent, but gift givers pay $100 to communicate their high regard for the
receiver.
Price and quality perceptions of cars interact. Higher-priced cars
are perceived to possess high quality. Higher-quality cars are likewise
perceived to be higher priced than they actually are. When alternative
information about true quality is available, price becomes a less
significant indicator of quality. When this information is not available,
price acts as a signal of quality.
Some brands adopt scarcity as a means to signify quality and
justify premium pricing. Some automakers have bucked the massive
discounting craze that shook the industry and are producing smaller
batches of new models, creating a buzz around them, and using the
demand to raise the sticker price. Waiting lists, once reserved for
limited-edition cars like Ferraris, are becoming more common for mass-
market models, including Volkswagen and Acura SUVs and Toyota and
Honda minivans.

PRICE CUES Consumer perceptions of prices are also affected by

alternative pricing strategies. Many sellers believe that prices should end
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in an odd number. Many customers see a stereo amplifier priced at $299
instead of $300 as a price in the $200 range rather than $300 range.
Research has shown that consumers tend to process prices in a "left-to-
right" manner rather than by rounding. Price encoding in this fashion is
important if there is a mental price break at the higher, rounded price.
Another explanation for "9" endings is that they convey the notion of a
discount or bargain, suggesting that if a company wants a high-price
image, it should avoid the odd-ending tactic. One study even showed
that demand was actually increased one- third by raising the price of a
dress from $34 to $39, but demand was unchanged when the price was
increased from $34 to $44.
Prices that end with "0" and "5" are also common in the marketplace as
they are thought to be easier for consumers to process and retrieve from
memory. "Sale" signs next to prices have been shown to spur demand, but
only if not overused: Total category sales are highest when some, but not
all, items in a category have sale signs; past a certain point, use of
additional sale signs will cause total category sales to fall.

Setting the Price

A firm must set a price for the first time when it develops a new product,
when it introduces its regular product into a new distribution channel or
geographical area, and when it enters bids on new contract work. The
firm must decide where to position its product on quality and price. Most
markets have three to five price points or tiers. Marriott Hotels is good at
developing different brands for different price points: Marriott Vacation
Club—Vacation Villas (highest price), Marriott Marquis (high price),
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Marriott (high-medium price), Renaissance (medium-high price),
Courtyard (medium price), Towne Place Suites (medium-low price),
Fairfield Inn (low price).
The firm has to consider many factors in setting its pricing policy. We
will describe a six-step procedure:

Selecting the pricing

objective;
Determining demand;

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 Pricing Strategy

Estimating costs;
Analyzing competitors' costs, prices, and
offers; Selecting a pricing method; and
Selecting the final price.

Fig : Setting Pricing Policy

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Price Segmentation
• Big opportunity:
– Computer allows finer discrimination

– Customers want choice but not confusion

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 Pricing Strategy

Segments
Consumer type : Use of product

• age
• sex • sports information,
• income • financial reports ,
• Education • information, etc.
• geography, etc.

Urgency of need
Service level

• Speed , • immediate,
• quality, • soon ,
• 7/24/365 , • overnight
• options / content
Volume of Use
Time of use

• Emergency Only , • Off-peak,

• Limited Usage, • Normal working
• Quantity Discount , hours ,
• Unlimited Usage • unrestricted

Length of Contract Longevity of customer

• 1, 2, 3 year sliding • special extras for

scale longevity

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Pricing Over Product Life Cycle :

Step 1: Selecting the Pricing Objective

The company first decides where it wants to position its market offering.
The clearer a firm's objectives, the easier it is to set price. A company can
pursue any of five major objectives

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 Pricing Strategy

through pricing: survival, maximum current profit, maximum market

share, maximum market skimming, or product-quality leadership.
SURVIVAL Companies pursue survival as their major objective if they
are plagued with overcapacity, intense competition, or changing
consumer wants. As long as prices cover variable costs and some fixed
costs, the company stays in business. Survival is a short-run objective; in
the long run, the firm must learn how to add value or face extinction.
MAXIMUM CURRENT PROFIT Many companies try to set a price
that will maximize current profits. They estimate the demand and costs
associated with alternative prices and choose the price that produces
maximum current profit, cash flow, or rate of return on investment. This
strategy assumes that the firm has knowledge of its demand and cost
functions; in reality, these are difficult to estimate. In emphasizing
current performance, the company may sacrifice long- run performance
by ignoring the effects of other marketing-mix variables, competitors'
reactions, and legal restraints on price.
MAXIMUM MARKET SHARE Some companies want to maximize
their market share. They believe that a higher sales volume will lead to
lower unit costs and higher long-run profit. They set the lowest price,
assuming the market is price sensitive. Texas Instruments (TI) has
practiced this market-penetration pricing. TI would build a large plant, set
its price as low as possible, win a large market share, experience falling
costs, and cut its price further as costs fall. The following conditions
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favor setting a low price:
The market is highly price sensitive, and a low price
stimulates market growth; Production and distribution costs
fall with accumulated production experience; and A low price
discourages actual and potential competition.
Penetration: Starts at lowest possible price
PROS: penetrates market quickly , keeps out competition
CONS: creates low reference price , misses full profit potential
MAXIMUM MARKET SKIMMING Companies unveiling a new
technology favor setting high prices to maximize market skimming. Sony
is a frequent practitioner of market- skimming pricing, where prices start
high and are slowly lowered over time. When Sony introduced the
world's first high-definition television (HDTV) to the Japanese market in
1990, it was priced at $43,000. So that Sony could "skim" the maximum
amount of revenue from the various segments of the market, the price
dropped steadily through the years—a 28-inch HDTV cost just over
$6,000 in 1993 and a 42-inch HDTV cost about $1,200 in 2004.
Market skimming makes sense under the following conditions:
A sufficient number of buyers have a high current demand;
The unit costs of producing a small volume are not so high that
they cancel the advantage
of charging what the traffic will bear;

The high initial price does not attract more

competitors to the market; The high price
communicates the image of a superior product.
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Skimming: Adjusts prices down over time:

PROS: skims off maximum profit for each segment &

establishes high reference price CONS: attracts competition,
difficult to administer

PRODUCT -QUALITY LEADERSHIP A company might aim to be

the product- quality leader in the market. Many brands strive to be
"affordable luxuries"—products or services characterized by high levels
of perceived quality, taste, and status with a price just high

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 Pricing Strategy

enough not to be out of consumers' reach. Brands such as Starbucks

coffee, Aveda shampoo, Victoria's Secret lingerie, BMW cars, and
Viking ranges have been able to position themselves as quality leaders
in their categories, combining quality, luxury, and premium prices with
an intensely loyal customer base.
OTHER OBJECTIVES Nonprofit and public organizations may have
other pricing objectives. A university aims for partial cost recovery,
knowing that it must rely on private gifts and public grants to cover the
remaining costs. A nonprofit hospital may aim for full cost recovery in
its pricing. A nonprofit theater company may price its productions to fill
the maximum number of theater seats. A social service agency may set
a service price geared to client income. Whatever the specific objective,
businesses that use price as a strategic tool will profit more than those
who simply let costs or the market determine their pricing.

Step 2: Determining Demand

Each price will lead to a different level of demand and therefore have a
different impact on a company's marketing objectives. The relation
between alternative prices and the resulting current demand is captured
in a demand curve. In the normal case, demand and price are inversely
related: The higher the price, the lower the demand. In the case of
prestige goods, the demand curve sometimes slopes upward. A perfume
company raised its price and sold more perfume rather than less! Some
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consumers take the higher price to signify a better product. However, if
the price is too high, the level of demand may fall.
PRICE SENSITIVITY
The demand curve shows the market's probable purchase quantity
at alternative prices. It sums the reactions of many individuals who have
different price sensitivities. The first step in estimating demand is to
understand what affects price sensitivity. Generally speaking, customers
are most price sensitive to products that cost a lot or are bought
frequently. They are less price sensitive to low-cost items or items they
buy infrequently. They are also less price sensitive when price is only a
small part of the total cost of obtaining, operating, and servicing the
product over its lifetime. A seller can charge a higher price than
competitors and still get the business if the company can convince the
customer that it offers the lowest total cost of ownership (TCO).
Although the Internet increases the opportunity for price-sensitive
buyers to find and favor lower-price sites, many buyers may not be that
price sensitive. McKinsey conducted a study and found that 89 percent
of a sample of Internet customers visited only one book site, 84 percent
visited only one toy site, and 81 percent visited only one music site,
which indicates that there is less price-comparison shopping taking place
on the Internet than is possible.
Companies need to understand the price sensitivity of their
customers and prospects and the trade-offs people are willing to make
between price and product characteristics. Targeting only price-sensitive
consumers may in fact be "leaving money on the table."
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 (a) Inelastic Demand (b) Elastic Demand

$15 $15 $15

$10 $10

100 105 50 150

Quantity Demanded per Period Quantity Demanded per Period

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 Pricing Strategy

ESTIMATING DEMAND CURVES

Most companies make some attempt to measure their demand
curves using several different methods.
Statistical analysis of past prices, quantities sold, and other factors
can reveal their relationships. The data can be longitudinal (over time) or
cross-sectional (different locations at the same time). Building the
appropriate model and fitting the data with the proper statistical
techniques calls for considerable skill.
Price experiments can be conducted. Bennett and Wilkinson
systematically varied the prices of several products sold in a discount
store and observed the results. An alternative approach is to charge
different prices in similar territories to see how sales are affected. Still
another approach is to use the Internet. An e-business could test the
impact of a 5 percent price increase by quoting a higher price to every
fortieth visitor to compare the purchase response. However, it must do
this carefully and not alienate customers, as happened when Amazon
price- tested discounts of 30 percent, 35 percent, and 40 percent for
DVD buyers, only to find that those receiving the 30 percent discount
were upset.
Surveys can explore how many units consumers would buy at
different proposed prices, although there is always the chance that they
might understate their purchase intentions at higher prices to discourage
the company from setting higher prices.
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 In measuring the price-demand relationship, the market researcher
must control for various factors that will influence demand. The
competitor's response will make a difference. Also, if the company
changes other marketing-mix factors besides price, the effect of the price
change itself will be hard to isolate. Nagle presents an excellent
summary of the various methods for estimating price sensitivity and
demand.
PRICE ELASTICITY OF DEMAND
Marketers need to know how responsive, or elastic, demand would
be to a change in price. Consider the two demand curves in Figure . With
demand curve (a), a price increase from
$10 to $15 leads to a relatively small decline in demand from 105 to
100. With demand curve (b), the same price increase leads to a
substantial drop in demand from 150 to 50. If demand hardly changes
with a small change in price, we say the demand is inelastic. If demand
changes considerably, demand is elastic. The higher the elasticity, the
greater the volume growth resulting from a 1 percent price reduction.
Demand is likely to be less elastic under the
following conditions: There are few or no
substitutes or competitors;
Buyers do not readily notice the
higher price; Buyers are slow to
change their buying habits; Buyers
think the higher prices are
justified.
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If demand is elastic, sellers will consider lowering the price. A lower
price will produce more
total revenue. This makes sense as long as the costs of producing and
selling more units do not increase disproportionately.
It is a mistake to not consider the price elasticity of customers and
their needs in developing marketing programs. In 1997, the Metropolitan
Transit Authority in New York introduced a new purchase plan for
subway riders that discounted fares after passes were used 47 times in a
month. Critics pointed out that the special fare did not benefit those
customers whose demand was most elastic, suburban off-peak riders
who used the subway the least. Commuters' demand curve is perfectly
inelastic; no matter what happens to the fare, these people must get to
work and get back home.

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 Pricing Strategy

Price elasticity depends on the magnitude and direction of the

contemplated price change. It may be negligible with a small price
change and substantial with a large price change. It may differ for a price
cut versus a price increase, and there may be a price indifference band
within which price changes have little or no effect. A McKinsey pricing
study estimated that the price indifference band can range as large as 17
percent for mouthwash, 13 percent for batteries, 9 percent for small
appliances, and 2 percent for certificates of deposit.
Finally, long-run price elasticity may differ from short-run
elasticity. Buyers may continue to buy from a current supplier after a
price increase, but they may eventually switch suppliers. Here demand is
more elastic in the long run than in the short run, or the reverse may
happen: Buyers may drop a supplier after being notified of a price
increase but return later. The distinction between short-run and long-run
elasticity means that sellers will not know the total effect of a price
change until time passes.

Step 3: Estimating Costs

Demand sets a ceiling on the price the company can charge for its
product. Costs set the floor. The company wants to charge a price that
covers its cost of producing, distributing, and selling the product,
including a fair return for its effort and risk. Yet, when companies price
products to cover full costs, the net result is not always profitability.
Page 43
TYPES OF COSTS AND LEVELS OF PRODUCTION
A company's costs take two forms, fixed and variable. Fixed
costs (also known as overhead) are costs that do not vary with
production or sales revenue. A company must pay bills each month for
rent, heat, interest, salaries, and so on, regardless of output.
Variable costs vary directly with the level of production. For
example, each hand calculator produced by Texas Instruments involves
the cost of plastic, microprocessor chips, packaging, and the like. These
costs tend to be constant per unit produced. They are called variable
because their total varies with the number of units produced.
Total costs consist of the sum of the fixed and variable costs for
any given level of production. Average cost is the cost per unit at that
level of production; it is equal to total costs divided by production.
Management wants to charge a price that will at least cover the total
production costs at a given level of production.
To price intelligently, management needs to know how its costs
vary with different levels of production. Take the case in which a
company such as TI has built a fixed-size plant to produce 1,000 hand
calculators a day. The cost per unit is high if few units are produced per
day. As production approaches 1,000 units per day, the average cost falls
because the fixed costs are spread over more units. Short-run average
cost increases after 1,000 units, because the plant becomes inefficient:
Workers have to line up for machines, machines break down more often,
and workers get in each others' way .
ACCUMULATED PRODUCTION
Page 44
 Suppose TI runs a plant that produces 3,000 hand calculators per
day. As TI gains experience producing hand calculators, its methods
improve. Workers learn shortcuts, materials flow more smoothly, and
procurement costs fall. The result, as Figure 14.4 shows, is that average
cost falls with accumulated production experience. Thus the average cost
of producing the first 100,000 hand calculators is $10 per calculator.
When the company has produced the first 200,000 calculators, the
average cost has fallen to $9. After its accumulated production
experience doubles again to 400,000, the average cost is $8. This decline
in the average cost with accumulated production experience is called the
experience curve or learning curve.

Page 45
 Pricing Strategy

Now suppose three firms compete in this industry, TI, A, and B. TI

is the lowest-cost producer at $8, having produced 400,000 units in the
past. If all three firms sell the calculator for
$10, TI makes $2 profit per unit, A makes $1 per unit, and B breaks
even. The smart move for TI would be to lower its price to $9. This will
drive B out of the market, and even A may consider leaving. TI will pick
up the business that would have gone to B (and possibly A).
Furthermore, price-sensitive customers will enter the market at the lower
price. As production increases beyond 400,000 units, TI's costs will drop
still further and faster and more than restore its profits, even at a price of
$9. TI has used this aggressive pricing strategy repeatedly to gain market
share and drive others out of the industry.
Experience-curve pricing, nevertheless, carries major risks.
Aggressive pricing might give the product a cheap image. The strategy
also assumes that competitors are weak followers. It leads the company
into building more plants to meet demand, while a competitor innovates
a lower-cost technology. The market leader is now stuck with the old
technology. Most experience-curve pricing has focused on
manufacturing costs, but all costs can be improved on, including
marketing costs. If three firms are each investing a large sum of money
in telemarketing, the firm that has used it the longest might achieve the
lowest costs. This firm can charge a little less for its product and still
earn the same return, all other costs being equal.
Page 46
ACTIVITY-BASED COST ACCOUNTING
Today's companies try to adapt their offers and terms to different
buyers. A manufacturer, for example, will negotiate different terms with
different retail chains. One retailer may want daily delivery (to keep
inventory lower) while another may accept twice-a-week delivery in
order to get a lower price. The manufacturer's costs will differ with each
chain, and so will its profits. To estimate the real profitability of dealing
with different retailers, the manufacturer needs to use activity-based cost
(ABC) accounting instead of standard cost accounting.
ABC accounting tries to identify the real costs associated with
serving each customer. It allocates indirect costs like clerical costs,
office expenses, supplies, and so on, to the activities that use them,
rather than in some proportion to direct costs. Both variable and
overhead costs are tagged back to each customer. Companies that fail
to measure their costs correctly are not measuring their profit correctly
and are likely to misallocate their marketing effort. The key to
effectively employing ABC is to define and judge "activities" properly.
One proposed time- based solution calculates the cost of one minute of
overhead and then decides how much of this cost each activity uses.
TARGET COSTING
Costs change with production scale and experience. They can also
change as a result of a concentrated effort by designers, engineers, and
purchasing agents to reduce them through target costing. Market
research is used to establish a new product's desired functions and the
price at which the product will sell, given its appeal and competitors'
Page 47
prices. Deducting the desired profit margin from this price leaves the
target cost that must be achieved. Each cost element—design,
engineering, manufacturing, sales—must be examined, and different
ways to bring down costs must be considered. The objective is to bring
the final cost projections into the target cost range. If this is not possible,
it may be necessary to stop developing the product because it could not
sell for the target price and make the target profit. To hit price and
margin targets, marketers of 9Lives® brand of cat food employed target
costing to bring their price down to "four cans for a dollar" via a
reshaped package and redesigned manufacturing processes. Even with
lower prices, profits for the brand doubled.

Page 48
 Pricing Strategy

Step 4: Analyzing Competitors' Costs, Prices, and Offers

Within the range of possible prices determined by market demand and
company costs, the firm must take competitors' costs, prices, and
possible price reactions into account. The firm should first consider the
nearest competitor's price. If the firm's offer contains features not offered
by the nearest competitor, their worth to the customer should be
evaluated and added to the competitor's price. If the competitor's offer
contains some features not offered by the firm, their worth to the
customer should be evaluated and subtracted from the firm's price. Now
the firm can decide whether it can charge more, the same, or less than
the competitor. But competitors can also change their prices in reaction
to the price set by the firm.

Step 5: Selecting a Pricing Method

Given the three Cs—the customers' demand schedule, the cost function,
and competitors' prices—the company is now ready to select a price. The
three major considerations in price setting : Costs set a floor to the price.
Competitors' prices and the price of substitutes provide an orienting
point. Customers' assessment of unique features establishes the price
ceiling.
Companies select a pricing method that includes one or more of these
three considerations. We will examine six price-setting methods:
markup pricing, target-return pricing, perceived-value pricing, value
Page 49
 pricing, going-rate pricing, and auction-type pricing.

MARKUP PRICING The most elementary pricing method is to add a

standard markup to the product's cost. Construction companies submit job
bids by estimating the total project cost and adding a standard markup for
profit. Lawyers and accountants typically price by adding a standard
markup on their time and costs.
TARGET-RETURN PRICING In target-return pricing, the firm
determines the price that would yield its target rate of return on
investment (ROI). Target pricing is used by General Motors, which prices
its automobiles to achieve a 15 to 20 percent ROI. This method is also
used by public utilities, which need to make a fair return on investment.
PERCEIVED-VALUE PRICING An increasing number of companies
now base their price on the customer's perceived value. They must deliver
the value promised by their value proposition, and the customer must
perceive this value. They use the other marketing-mix elements, such as
advertising and sales force, to communicate and enhance perceived value
in buyers' minds. Perceived value is made up of several elements, such as
the buyer's image of the product performance, the channel deliverables,
the warranty quality, customer support, and softer attributes such as the
supplier's reputation, trustworthiness, and esteem. Furthermore, each
potential customer places different weights on these different elements,
with the result that some will be price buyers, others will be value buyers,
and still others will be loyal buyers. Companies need different strategies
for these three groups. For price buyers, companies need to offer stripped-
Page 50
down products and reduced services. For value buyers, companies must
keep innovating new value and aggressively reaffirming their value. For
loyal buyers, companies must invest in relationship building and
customer intimacy.

Page 51
 Pricing Strategy

VALUE PRICING In recent years, several companies have adopted

value pricing: They win loyal customers by charging a fairly low price
for a high-quality offering. Among the best practitioners of value pricing
are IKEA and Southwest Airlines. In the early 1990s, Procter & Gamble
created quite a stir when it reduced prices on supermarket staples such as
Pampers and Luvs diapers, liquid Tide detergent, and Folger's coffee to
value price them. In the past, a brand- loyal family had to pay what
amounted to a $725 premium for a year's worth of P&G products versus
private-label or low-priced brands. To offer value prices, P&G
underwent a major overhaul. It redesigned the way it developed,
manufactured, distributed, priced, marketed, and sold products to deliver
better value at every point in the supply chain.
Value pricing is not a matter of simply setting lower prices; it is a matter
of re-engineering the company's operations to become a low-cost
producer without sacrificing quality, and lowering prices significantly to
attract a large number of value-conscious customers. An important type
of value pricing is everyday low pricing (EDLP), which takes place at
the retail level. A retailer who holds to an EDLP pricing policy charges a
constant low price with little or no price promotions and special sales.
These constant prices eliminate week-to-week price uncertainty and can
be contrasted to the "high-low" pricing of promotion-oriented
competitors. In high-low pricing, the retailer charges higher prices on an
everyday basis but then runs frequent promotions in which prices are
Page 52
temporarily lowered below the EDLP level. The two different pricing
strategies have been shown to affect consumer price judgments—deep
discounts (EDLP) can lead to lower perceived prices by consumers over
time than frequent, shallow discounts (high- low), even if the actual
averages are the same.
In recent years, high-low pricing has given way to EDLP at such widely
different venues as General Motors' Saturn car dealerships and upscale
department stores such as Nordstrom; but the king of EDLP is surely
Wal-Mart, which practically defined the term. Except for a few sale
items every month, Wal-Mart promises everyday low prices on major
brands. "It's not a short-term strategy," says one Wal-Mart executive.
"You have to be willing to make a commitment to it, and you have to be
able to operate with lower ratios of expense than everybody else."
Some retailers have even based their entire marketing strategy
around what could be called extreme everyday low pricing. Partly
fueled by an economic downturn, once unfashionable "dollar
stores" are gaining in popularity:

The most important reason retailers adopt EDLP is that constant sales
and promotions are costly and have eroded consumer confidence in the
credibility of everyday shelf prices. Consumers also have less time and
patience for such time-honored traditions as watching for supermarket
specials and clipping coupons. Yet, there is no denying that promotions
create excitement and draw shoppers. For this reason, EDLP is not a
guarantee of success. As supermarkets face heightened competition from
Page 53
their counterparts and from alternative channels, many find that the key
to drawing shoppers is using a combination of high-low and everyday
low pricing strategies, with increased advertising and promotions.

GOING-RATE PRICING In going-rate pricing, the firm bases its price

largely on competitors' prices. The firm might charge the same, more, or
less than major competitor(s). In oligopolistic industries that sell a
commodity such as steel, paper, or fertilizer, firms normally charge the
same price. The smaller firms "follow the leader," changing their prices
when the market leader's prices change rather than when their own
demand or costs change. Some firms may charge a slight premium or
slight discount, but they preserve the amount of difference. Thus

Page 54
 Pricing Strategy

minor gasoline retailers usually charge a few cents less per gallon
than the major oil companies, without letting the difference increase
or decrease.
Going-rate pricing is quite popular. Where costs are difficult to
measure or competitive response is uncertain, firms feel that the
going price is a good solution because it is thought to reflect the
industry's collective wisdom.

AUCTION-TYPE PRICING Auction-type pricing is growing

more popular, especially with the growth of the Internet. There are
over 2,000 electronic marketplaces selling everything from pigs to
used vehicles to cargo to chemicals. One major purpose of auctions
is to dispose of excess inventories or used goods. Companies need
to be aware of the three major types of auctions and their separate
pricing procedures.
English auctions (ascending bids). One seller and many buyers. On
sites such as Yahoo! and eBay, the seller puts up an item and bidders
raise the offer price until the top price is reached. English auctions
are being used today for selling antiques, cattle, real estate, and used
equipment and vehicles. After seeing ticket brokers and scalpers
reap millions by charging what the market would bear, Ticketmaster
Corp. began auctioning the best seats to concerts in late 2003
through its Web site.
Dutch auctions (descending bids). One seller and many buyers, or
one buyer and many sellers. In the first kind, an auctioneer
announces a high price for a product and then slowly decreases the
price until a bidder accepts the price. In the other, the buyer
announces something that he wants to buy and then potential sellers
compete to get the sale by offering the lowest price. Each seller sees
what the last bid is and decides whether to go lower.
FreeMarkets.com helped Royal Mail Group pic, the United
Kingdom's public mail service company, save approximately 2.5
million pounds in part via an auction where 25 airlines bid for its
international freight business.
Sealed-bid auctions. Would-be suppliers can submit only one bid
and cannot know the other bids. The U.S. government often uses
this method to procure supplies. A supplier will not bid below its
cost but cannot bid too high for fear of losing the job. The net effect
of these two pulls can be described in terms of the bid's expected
profit. Using expected profit for setting price makes sense for the
seller that makes many bids. The seller who bids only occasionally
or who needs a particular contract badly will not find it
advantageous to use expected profit. This criterion does not
distinguish between a $1,000 profit with a 0.10 probability and a
$125 profit with a 0.80 probability. Yet the firm that wants to keep
production going would prefer the second contract to the first.

Step 6: Selecting the Final Price

Pricing methods narrow the range from which the company must
select its final price. In selecting that price, the company must
consider additional factors, including the impact of other marketing
activities, company pricing policies, gain-and-risk-sharing pricing,
and the impact of price on other parties.
 Chapter 2

Company Profile

Company Details
CIN U70102UP2013PTC054746
Company SHINECITY INFRAPROJECT
Name PRIVATE LIMITED
Company Active
Status
RoC RoC-Kanpur
Registration 54746
Number
Company Company limited by Shares
Category
Company Non-govt company
Sub Category
Class of Private
Company
Date of 18 January 2013
Incorporation
Age of 5 years, 7 month, 17 days
Company
Activity Real estate activities with own or leased
property. [This class includes buying,
selling, renting and operating of self-
owned or leased real estate such as
apartment building and dwellings, non-
residential buildings, developing and
CIN U70102UP2013PTC054746
subdividing real estate into lots etc.
Also included are development and sale
of land and cemetery lots, operating of
apartment hotels and residential mobile
home sites.(Development on own
account involving construction is
classified in class 4520).]
Click here to see other companies
involved in same activity.

Share Capital & Number of Employees

Authorised Capital ₹10,000,000

Paid up capital ₹160,000
Number of Employees Login to view

Listing and Annual Compliance Details

Listing status Unlisted

Date of Last Annual General 30 September
Meeting 2014
Date of Latest Balance Sheet 31 March 2014
About SHINE CITY INFRA PROJECT PRIVATE LIMITED

Shine city's primary business is development of residential,

commercial and retail properties. The company has a unique business
model with earnings arising from development Shine city offers you
the opportunity to live life in a relaxed yet grand way. So while you
sip on chai with your friends, or read a book while enjoying the
scenery or simply take a walk with your loved ones, we see to it that
your home and its amenities are a perfect blend of comfort and style.

A Community and party hall for an enjoyable social life and world
class infrastructure marks living at shine city a dream.

Shine city Infraproject Private Limited is a Private incorporated on 18

January 2013. It is classified as Non-govt. Company and is registered
at Registrar of companies, Kanpur. Its authorized share capital is
Rs.10,000,000 and its paid up capital is Rs.16,0000. It is involved in
Real estate activities with own or leased property. [This class includes
buying, selling, renting and operating of self –owned or leased real
estate such as apartment building and dwellings, non-residential
building, developing and subdividing real estate into lots etc. Also
included are development and sale of land and cemetery lots,
operating of apartment hotels and residential mobile home sites.

Director of Shine city Infraproject Private Limited are Mohammad

Izhar Ansari, AsifNaseem.
OUR VISION, MISSION AND VALUES

We envision our company as your trusted brand to create the modern

townships. Shine City is meant to develop lands all over the world that
make use of the latest and most comfortable options available. That
includes handling regular delivery of products, and managing services.

Starting with the real estate industry, we research and apply the newest
technologies, focused on eco-friendly applications. Then, we are
engagedin making life simpler. To achieve so, we are committed to
bringing our customers a single platform to get products and services.

For all our business lines, we are engaged with:

High Quality

Building Trust

High Customer Satisfaction

HOW SHINE CITY STARTED

Mr. Rashid Naseem conceived the Shine City concept. It all started as
an effort to redefine the current Sky Line of the city. He started in the
Real Estate industry with a greater goal in mind: to reach the common
man. Not just by building his home, but also providing the best
possible experience when shopping and using services.
Today, Shine City is closest to the dream Mr. Rashid had, and it is
moving forward to the next step.

LEGAL ADVISOR

Mr. Shri Krishna Mishra(Advocate High Court)

SHINE CITY’S TEAM

The secret to our success is your team. We are all young people with a
high commitment to delivering quality and customer satisfaction.
Each member of the Shine City group is a valuable team player. All
our staff is engagedin delivering on time. Creativity is promoted and
rewarded. Our experienced professionals encourage innovation at all
times, which is key to our success.

Everybody at Shine City knows our clients are the most important.
Therefore, you will not find a better treatment for the perfect home.

ADJUSTED TO YOUR NEEDS, PLC APPLICABLE

PLC or Preferential Location Charge is the additional charge paid to

reserve a unit that has a better location within a particular design or
complex. Therefore, to get an apartment with a view of a park, lake,
etc., one has to pay a higher cost.

In Shine City commercial projects you will find the option of applying
PLC up to 20% of the real value of the property. Once selected the
complex, you can choose to be in a corner for 5% more, haveto park
in front for 5% more, be close to the main road for 5% more, and/or
have apreference in commercial premises by 10% more. It is an
incredible personalization option for your company or commercial
place.

THE BEST CHOICES FOR THE BEST LOCATIONS

With more than 30 projects in 11 major locations in India, Shine City

gives you the possibility to choose the commercial or residential
project that best suits your needs. Let us give you a look, at the most
relevant projects in some of the main locations.

LUCKNOW

Lucknow, most known as the city of Nawabs is the one with more
quantity of commercial and residential projects going on, here are
some of them:

Paradise Garden.A project that perfectly combines nature with the best
of modern infrastructure, and one to have peace and incomparable
peace.A great place for your business and family.

Shine Valley. A natural environment and many amenities are

combined thanks to a pleasant design where you can get away from
traffic and noise from its large balconies.

Solitaire City. A project that gives life to the dream of many who want
to have a great place to live or to start their own business, at prices
that are available to an average person.
Royal Residence. Another environmentally friendly project that
reflects Shine City's approach to providing the best housing options,
which stand out for its modernity.

Other projects that Shine City has in Lucknow are Green Homes,
Dream Homes, Xhevahire City, Nature City, SamridhiGullak,
Samridhi Nature Valley, Velvet City, VaidikVihar, Royal Residence
Faizabad Road.

KANPUR

Located near the Ganges River, Kanpur houses 5 of our fabulous

projects.

Galaxy Kanpur.An incredible residential colony project near to

Chaubepur Thana in which will enjoy the best things in life.

Pole Star City. With several amenities at the project, like the
commercial area, Pole Star City provides flexibility to handle the
challenges of these modern times.

Pole Star City 2.Another innovative residential project to which you

can access and obtain a 12% discount for making the payment within
30 days following the booking.

Pole Star City SamraddhiGullak.A project with a great commercial

front that stands out from the others in this beautiful area of the city.

Pole Star City SamraddhiNiwas. A community center, swimming

pool, a gym and of course a large shopping area are the features of this
modern project.
VARANASI

Five projects are also the ones that adorn this wonderful and sacred
city.

Kashiyana. A project that brings together in three incredible blocks

residential plots, with many options for financing and payment so that
you choose the one that best suits your needs.

KutumbKashiyana. Our latest project in this blessed city in which

everything becomes better, and to better blend with it, we have made
the best of nature in its interior.

ChandrokKashiyana. A beautiful residential colony with access to a

shopping area, a hospital among other amenities that will make your
life easier.

Arise Velvet. With a 100% Down Payment Plan, this project offers
you the best amenities to enjoy even more of this beautiful city.

Elite Kashiyana. A quiet place close to the police station in the area,
which gives an extra security feature that, will give much more
tranquility to locate your business or move there with your family.

Like these projects, you will find much more in Allahabad,

Gorakhpur, Mirzapur, Sultanpur, Bihar, Kolkata, Pratapgarh, and
Raebareli. This way you will find with us a lot of options which will
surely cover all your needs.

COMMERCIAL
Shine City commercial buildings are redefinition of Excellence.
Fabulous commercial complex are build to architect the sky line in the
ultra modern way. Shine City's commercial builds are the mixture of
Comfort, Quality, Luxury and Style under one roof. Ample of retail
space, office space, parking lot, ready to move in service apartment
and other top line facilities. Hanging out area is crafted with the
concept in mind 'work & play'. These commercial build are perfect
integration for small and big corporate giants

Shine city's commercial complexes are the new style statement in the
realty sector which have given a new dimension to the commercial
buildings.

A SAFE INVESTMENT TO GIVE YOU GREAT RETURNS.

KEY FEATURES ARE

Advance security system

CCTV coverage

Comfortable & playful Parks

Advance fire protection technology

24 hours water supply

Gardens and ponds

PLC APPLICABLE

PLC APPLICABLE
Success story

Shine City-New Definition for Home

Shine City is giving new definition to the urban development in Uttar
Pradesh. It is aiming to change the sky line of the state housing
scenario. Having new dimensions to aim for, Shine City is leaving its
footprints in all the major areas of Lucknow City by developing its
marvelous housing, townships, and projects.

Shine City is a true statement for Quality Excellence &

Commitment in Real Estate Industry.

Shine City is the most promising name among many Real Estate
Company operating across Uttar Pradesh and having its head office at
Lucknow, the City of Nawabs. Company is achieving milestones since
its inception and heading towards ever-greater success. Shine City is
one of the fastest growing real estate companies in Uttar Pradesh.
Company is continuously matching its standards with the established
real estate companies of Uttar Pradesh. We are forefronting all the
Small Real Estate Companies of Uttar Pradesh and giving tough
competitions to the big names of Real Estate Development
Companies.

CEO MESSAGE

Welcome to the official website of Shine City!

First of all, we want to thank you for being a valuable customer. Your
time is valuable to us, and we appreciate the time you took to look
around our website.

I am proud of the team we have formed and how Shine City has
grown from the Real Estate Market to the retail and service industry.
All our success is the result of the effort of our employees, who I want
to recognize in this message especially.

Stakeholders and investors who have put their trust in our company
also deserve recognition. Without them, none of this dream would’ve
been possible.

Finally, I want to invite our customers to look at our complete offer.

We are here to make your life easier, starting at home. It is not just
about technology and eco-friendly options to your house, but to create
a unique ambiance where you feel like home.

Thanks to all our clients for trusting in us all these years, and we hope
we continue to serve you much more. Our final goal is to change how
the common man lives, which means we still have a long way to walk.

COMPANY POLICY

Dear Members,

Good More Earnings!!

As per the revised company policy, it has been decided that opening
new Scope Branches (Infrastructure & Furnishing) shall be the
complete responsibility of the facilitators and their respective Seniors.
On a business of Rs. 2 Cr and above company would be paying the
rent, failing the target the facilitator would be bearing the same.

Kindly cooperate & Wish you all the best.

Warm Regards

Shine City Infra Project Pvt. Ltd.

LEGAL

SISTER CONCERN COMPANIES OF SHINECITY INFRA

PROJECT PVT. LTD.

Sr. No COMPANIES OF SHINECITY GROUP

1 SHINECITY INFRAPROJECT PVT. LTD.

2 SHINECITY ERECTOR PVT. LTD.

3 SHINECITY DEVELOPERS PVT. LTD.

4 SHINECITY PROPERTIES PVT. LTD.

5 SHINECITY COLONISER PVT. LTD.

6 SHINECITY CONSTRUCTIONS PVT. LTD.

7 SHINECITY FOODS & MEDIA PVT.LTD.

8 SHINECITY REALTORS PVT. LTD.

9 SHINECITY REAL ESTATE PVT. LTD.

10 SHINECITY CHARIOTEER OF RELIABLE

SERVICES PVT. LTD

11 SHINECITY BUILDERS PVT. LTD

12 SHINECITY SHAPERS PVT. LTD.

13 ARISE INFRA PROPERTIES MARKETING
PVT.LTD.

OUR GREEN INITIATIVES

At Earth on we believe in creating spaces that have international feel
but suited to Indian tastes. Our innovative architecture designs are
modeled on eco-friendly concepts and incorporate the best of East and
West.
The idea behind our residential spaces is that owners come home to
green havens of peace, a place that evokes in them a feeling of joie de
vivre! Our commercial places that pulsate with human activity are
marvels of technical innovation based on the concept of sustainable
development.
For us aesthetics of open spaces is as important as the inner space, so
our open spaces are as meticulously planned and designed as the inner
one. We utilize our open spaces to create green patches around our
high rise buildings, so the people, who are always on the go, can take
some time off and connect with their inner being in the freshness of
their green surroundings. No matter how tall our building may rise,
never lose touch with our roots. We are committed to protecting the
environment. We believe in the concept of green living and are
incorporating the green building techniques in our projects, because
we understand that life flourishes best when we align our needs
without physical environment.
We believe in sustainable urbanization, so we build sustainable homes.

In our residential and commercial projects we have rainwater

harvesting facilities and solar panels to make buildings energy

efficient. To improve the thermal performance of the building we use

high-performance glass for windows and roof insulation. We are also

working on facilities that can offer waste management solutions to our

buyers.
 Chapter 3

Research Methodology

Abstract :

From time to time we come across instances where businesses are

not realizing their full potential when setting prices. Sometimes this
can mean missed revenue, in other cases it can have a negative
effect on the brand – sending a mixed message of what it stands for.
In either case profits can be lost. In this research paper , we take a
look at the key factors to consider when reviewing your pricing
strategy. Price is the only revenue generating element amongst the
4ps,the rest being cost centers. Pricing is the manual or automatic
process of applying prices to purchase and sales orders, based on
factors such as: a fixed amount, quantity break, promotion or sales
campaign, specific vendor quote, price prevailing on entry,
shipment or invoice date, combination of multiple orders or lines,
and many others. Automated systems require more setup and
maintenance but may prevent pricing errors. In setting pricing
policy, a company estimates the demand curve, the probable
quantities it will sell at each possible price. It estimates how its
costs vary at different levels of output . In this paper , we also study
situations when companies often face situations where they may
need to cut or raise prices. The firm facing a competitor's price
change must try to understand the competitor's intent and the likely
duration of the change.

Research objectives

1. Profits-related Objectives:

i. Maximum Current Profit:

ii. Target Return on Investment:

2. Sales-related Objectives:

i. Sales Growth:

ii. Target Market Share:

iii. Increase in Market Share:

3. Competition-related Objectives:

i. To Face Competition:

ii. To Keep Competitors Away:

iii. To Achieve Quality Leadership by Pricing:

iv. To Remove Competitors from the Market:

4. Customer-related Objectives:

i. To Win Confidence of Customers:

ii. To Satisfy Customers:

5. Other Objectives:

i. Market Penetration:

ii. Promoting a New Product:

iii. Maintaining Image and Reputation in the Market:

 iv. To Skim the Cream from the Market:

v. Price Stability:

vi. Survival and Growth:

RESEARCH PROBLEM

Real Estate Corporate facing financial crunch Decreasing business of

Real Estate Companies.

RESEARCH DESIGN

Determined the Information Sources: The researcher gathered data

through secondary sources.

PRIMARY DATA is collected through questionnaire, search and

research from developers and market watchers.

SECONDARY DATA is being search sites like magazines,

newspapers, journals, websites and the data has been collected

through other approaches.

DATA COLLECTION

The researcher collected information through the official websites,

magazines and journals.

DEVELOPED THE RESEARCH FRAME:

This included deciding upon various aspects for the project on which

the entire research is based. The research frame included:

NATURE OF STUDY

The project on which the researcher worked is descriptive and

inferential in nature.

DATA SOURCE:

The researcher took the help of both primary as well as secondary

sources. Primary data was selected from Earthcon Construction Pvt.

Limited. Secondary sources being interaction with various Real Estate

people of the selected and has been chosen for the research by the

researcher. Secondary sources being the internet as the medium and

the official sites of the companies of Real Estate sectors and corporate

selling and feedback on real estate Companies.

INSTRUMENT USED

The researcher for the research used a Questionnaire cum Schedule for

market research for both the segments horizontal and vertical. The

Questionnaire was prepared by the researcher and Schedule was

provided by the company in which the researcher did its research

report.

SAMPLE SIZE
Sample size for the research is fixed. It counts to 100.

SAMPLE AREA

Mirzapur
CHAPTER-IV
 DATA ANALYSIS

1.
1 Attractive packaging 100
2 Shop display & Advertising 60
3 Word of mouth 100
4 Dealer 80

Factors influence a consumer to buy

particular Brand
Attractive
29%
Dealer
packaging
24%

Word of mouth Shop display &

29% Advertising
18%

Interpretation: Word of Mouth is considered as a very

important and useful tool in rural areas. Shopkeeper and
relatives recommendation are considered as very important and
rural customers get influenced by their advice. Attractive
Packaging is considered as important as word of mouth
publicity, when rural customers were asked to comment on this,
almost 200(58%) respondents considered attractive packaging
and word of mouth to be the most influential strategies which
influence them the most. While 80(24%) consumers said dealers
and retailers influence them when they buy any product and they
consider their advice genuine and useful. Remaining 60(18%)
respondents considered shop display as well as in- store
advertising important and they decide the brand at the time they
enter in a shop and they make up their mind when they see wall
displays and other advertisements and even products in the
shelves.
2

1 Strongly Agree 80
2 Agree 140
3 Neutral 100
4 Strongly Disagree 0
5 Disagree 20

Promotional Schemes affects the

Purchasing Decision
Strongly 6% Strongly Agree
Disagree
Disagree 24%
0%

Neutral
29%
Agree

41%

Interpretation: Promotion is the most effective tool for

attracting and influencing the customer. It includes elements like
personal selling, advertising, public relation, sales promotion
and direct marketing. It helps in conveying message about the
product offering to the customers, creating demand, market
positioning, make a decision related to buy a product. It can
interpreted on the basis of various researches that sales
promotion is one which encourages quick and large purchases in
a limited period of time. It can be said that, it’s a marketing
activity that adds the value proposition related to a product in
order to stimulate consumer purchasing, effective sales and the
effort made by the sales force.

When rural consumers were asked, chunk of the respondents

220(65%) said promotional schemes stimulates the purchasing
decision while 100(29%) feel it depends on various factors
including pricing, promotion, place as well as attributes of the
product which influence rural customers and encourage them to
buy the product. Remaining 20(6%) has rejected this view and
they are of different opinion, they feel promotional schemes
hardly influence rural customer as they are not educated and
they cannot differentiate the benefits of the product.
3

1 Money back offer 240

2 Prizes on bottle cap 60
Prizes on the specific number of
3 bottle caps. 40
4 Bumper Prize 0

Prizes on the Promotional scheme changes the

specific
number of
buying decision of a Customer
bottle caps.
Bumper Prize
12% 0%
Prizes on bottle

cap Money back

18%
offer
70%

Interpretation: Promotional schemes influences rural customers and

they are very curious to explore different promotional schemes. REAL
ESTATE companies in particular are promoting their products by
launching various promotional schemes like Money back offer,
bumper prize, prizes on bottle cap etc. When rural consumers were
interviewed, it was observed that rural consumers are highly
influenced by various promotional schemes. Money back offer- 240,
Prizes on bottle cap- 60, Prizes on the specific number of bottle caps-
40.
4
1 Strongly Agree 220
2 Agree 60
3 Neutral 40
4 Strongly Disagree 20
5 Disagree 0

Visual advertisements on television are

more effective than audio advertisements

on Radio.
Disagree
6%
Strongly
Neutral 0%
Disagree

12%
Strongly Agree
Agree
65%
17%

Interpretation: Radio and TV advertising are a typical part of a

company's strategic marketing mix. Earlier, radio was considered as a
well established medium in rural areas. It was used as one of the
oldest and potential media for communication with farmers and for
diffusing agricultural technology, radio has yielded significant results.
Today, television has proved to be an effective medium for
communication with the rural masses. Television reaches the larger
segment of rural population than any other form of mass media except
Radio. But people like to see to believe. Television has proven
advantageous in communicating with the rural people due to the low
literacy levels.

When rural consumers were interviewed, it was observed that

 220(65%) respondents said visual advertisements on television
are more effective

than audio advertisements on Radio as it has its own advantages.

60(17%) were of the same opinion and they considered television
advertisements more effective and influencing, they can easily
identify the product as it was shown on the television. 40(12%)
respondents said visual advertisements on television and audio
advertisements on Radio have their own advantages and
disadvantages. Both the mediums are useful in rural areas. Still deep
interior parts of rural areas are not getting proper supply of
electricity and in this case advertisements on radio are more useful.
It was observed that 20(6%) respondents feel advertising on radio
are more effective in rural areas as availability of radio sets has
expanded. A big expansion in the broadcasting facilities has taken
place in the rural country over the years.
5
1 Media & Print112
Media
2 Radio 58
3 Melas/fairs 130
4 Wall Painting 20
5 Billboards 0

Effectiveness of different advertising

techniques
Wall PaintiBnigllboards
6%
Media & Media & Print
0% Print Media
Melas/Fair
s
Media Radio
41% 35%
Radio Melas/Fairs

18% Wall Painting

Billboards

Interpretation: When the effectiveness of different advertising

techniques were measured in the rural areas. Various advertising
techniques like Media & Print Media, Radio, Wall Paintings, Melas/
Fairs, Billboards etc were measured in percentages.

6
1 Discount Policy 280
Promotion
2 al Policy 60
Policies affecting buying selection
Promotional
Policy

18%

Discount Policy

82%

Interpretation: Rural consumers always expect something from the

marketer in the form of a scheme, additional benefit etc. on the item
purchased. When rural consumers were interviewed it was observed
that price off or discount method is the most effective method that
affects the buying selection of rural consumers. Chunk of the
respondents, 280(82%) were influenced by the paid off or discount
method. While remaining 60(18%) rural consumers said they get
influenced by promotional methods including Advertising,
Digital/Interactive, Public Relations etc.

7
1 Strongly Agree 60
2 Agree 120
3 Neutral 60
4 Strongly 0
Disagree
5 Disagree 100

Presence of celebrities in the

advertisements influence customer
to buy a product
Strongly Agree
18%
Strongly Disagree Agree
Neutral
29%
Disagree 18% 35%
0%

Interpretation: Celebrity usage in advertisements is one of the

contemporary strategies of many brands, the purpose of such usage
may be for getting attention, for prolonged association, or for the
purpose of recall. The consumers seek variety of aspects like
credibility, likeability, fit between the brand and the celebrity. The
celebrities in India are the role models for majority of Indians, they
are so influenced by them that most of the population follows the
trends of their dressing, styles and habits. The companies believe
that the celebrity changes the purchase intention of the rural
consumers in India. During the interview, it was observed that rural
consumers take celebrities very seriously and sometimes they see
them as their role models and they try to copy them and a tendency
was found in

the rural consumers that they think the product which is endorsed by
the celebrity; the product must have been consumed by the same. In
this way the sale of the product gets increased.

180(53%) rural customers said they select the product on the basis
of the celebrities who endorsed the advertisement. It is very much
affected by their interest area; few of them prefer film stars,
sportsman as their role models. 60(18%) respondents said they
consider other elements like packaging, promotional schemes,
discount, shopkeeper recommendation etc. along with this factor
while they buy any daily consumable item. Remaining 100(29%)
rural customers were having different opinion on this, they don’t
consider presence of any celebrity in the advertisement important or
they don’t think it will influence their purchasing decision.
Companies invest billions on endorsing celebrities for their product
and ultimately the burden will come on the customers and they have
to bear the cost of endorsing a celebrity, they consider shopkeeper
advice more seriously and it affects their buying decision.
8.
Strongly Agree 50
Agree 60
Neutral 10
Strongly Disagree 0
Disagree 0

Effects of Advertising on sales

Strongly

Disagree Neutral Disagree

0%

8% 0%

Strongly Agree
42%

Agree
50%

Interpretation: When it comes to rural Advertising, different

experts have different opinions. Few have considered presence of
celebrity or mascots important in the advertisements and few
experts feel taglines and jingles play an important role in building a
brand. Around 120 channel members were interviewed and they
have different opinions regarding effects of adverting on sales. It
was observed that chunk of the respondents about 110 (98%) feel
that advertising affects the sales of the company and helps in
generating higher profits while remaining 10 (8%) feel it may or
may not affect the sales of the company.
9
Strongly Agree 60
Agree 50
Neutral 0
Strongly Disagree 0
Disagree 10

‘Word of Mouth’ is the most important

method of the publicity and the most

trusted source of communication in rural
areas
Strongly 8%
Disagree
Disagree
0%
Neutral Strongly
0% Agree
Agree
42% 50%

Interpretation: Direct marketing is one of the most powerful and

effective ways to meet the target customer. Direct marketing
campaigns can be very effective. As rural folks are highly influenced
by the influence groups and word of mouth, direct marketing can play
a crucial role in increasing the marketing base. However it is very
much essential to understand that any direct marketing campaign will
rely on the field workers and their emotional connectivity and
sensitivity to rural markets. Once the rural team is trained, getting well
versed with rural culture and beliefs, they can easily hold and manage
activities like product promotion, marketing and Door-to-Door
sampling. These activities can also be implemented successfully at
places like melas and festivals, local cinema halls, in the midst of
cross-cultural gatherings and conglomerations. To make the study
meaningful in the rural context, a question was posed to rural channel
members about their opinion regarding “word of mouth” publicity.

60(50%) have strongly regarded “word of mouth” publicity as the most

important method and the most trusted source of communication in the
rural areas. Same 50(42%) respondents have accepted this fact and said
word of mouth publicity generates positive environment and publicity
among rural masses. While 10(8%) respondents have a different
outlook and they consider other source of publicity as more influential
in comparison to “word of mouth” publicity in rural areas.
10

Strongly Agree 60
Agree 50
Neutral 0
Strongly Disagree 0
Disagree 10

Attractive packaging enables

consumer to buy the product

Strongly Disagree

Disagree 8%
Neut0ra%l

0% Strongly Agree

Agree 50%

42%

Interpretation: Preference for attractive packaging is noticed in

rural marketing. Packaging creates a favorable impression in rural
customers’ minds which impacts their buying behavior. Rural people
would remember an REAL ESTATE by its packaging. It is
recommended to allot great deal of attention towards designing
attractive packaging while keeping the costs low. Also the rural
marketers can promote their REAL ESTATE on the basis of
attractive packaging.
Chunk of the respondents strongly advocated it and 60(50%) said
attractive packaging can attract more number of customers and the
marketers can increase their sales by promoting attractive packaged
goods. While 50(42%) were of the same opinion and they were
agreed on the fact and considered attractive packaging useful in
increasing their customer base. Few respondents think it will
increase the cost of the product and ultimately give more burden on
the marketer in selling the product in rural areas where customers are
price sensitive and they rate the product on the basis of value of their
money and they hardly get affected by attractive packaging.
 Pricing Strategy
Finding
1- The performance reported by the personnel of the housing finance
institutions is better for all the five housing finance institutions selected for
the study. The satisfaction of the customers of the selected housing finance
institutions in Gujarat region was appreciable in spite of healthy
competition. It is more or less equal in all the institutions,
2- Among the selected housing finance institutions, the customers of
HDFC reported a high level of satisfaction than other housing finance
institution. Among the other four housing finance institutions, the
satisfaction levels of the customers are more or less the same.
3) The customers in general while choosing a housing finance institution,
give first preference to the amount of loan available from the housing
finance providers. They consider the interest rate as very least important
one to select a housing finance institution. This may be due to the
indifference interest rate.
4) The customers of housing finance institutions seek loan through housing
finance than any other source of finance because the housing finance is
easily affordable to the customers in these days. The housing finance
providers are coming up with various schemes and services. This attracts
the customers towards housing finance institutions.
5) Now various types of institutions are providing housing finance to all
types of customers. All these schemes were implemented to satisfy the
customers and to increase their turnover. But the customers' expectations
are countless from housing finance institutions. They expect a courteous
service from personnel of the institution. They expect a prompt and quick
service. Their expectations many times fall below what they experience
from the housing finance institutions. But sometimes they are experiencing
a good level of service beyond their expectation. It varies from institution
to institution.
6) The outcome of a sound customer philosophy is perceived to be a
positive influence on customer retention. The most significant factors
contributing to the market share and customer retention is the customer
philosophy followed by the strategic orientation. The factors contributing
more to sales growth and return on investment are the operational
efficiency followed by strategic orientation.
7) The customer satisfaction is determined by customer philosophy,
strategic orientation, operational efficiency and adequate marketing
information. The customer satisfaction is strongly predicted by the
customer philosophy.
 CONCLUSION :

1.Despite the increased role of non price factors in modern marketing,

price remains a critical element of the marketing mix. Price is the only
element that produces revenue; the others produce costs.
2. In setting pricing policy, a company follows a six-step procedure. It
selects its pricing objective. It estimates the demand curve, the probable
quantities it will sell at each possible price. It estimates how its costs
vary at different levels of output, at different levels of accumulated
production experience, and for differentiated marketing offers. It
examines competitors' costs, prices, and offers. It selects a pricing
method. It selects the final price.
3. Companies do not usually set a single price, but rather a pricing
structure that reflects variations in geographical demand and costs,
market-segment requirements, purchase timing, order levels, and other
factors. Several price-adaptation strategies are available: (1)
geographical pricing; (2) price discounts and allowances; (3)
promotional pricing; and (4) discriminatory pricing.
4.After developing pricing strategies, firms often face situations in
which they need to change prices. A price decrease might be brought
about by excess plant capacity, declining market share, a desire to
dominate the market through lower costs, or economic recession. A price
increase might be brought about by cost inflation or over demand.
Companies must carefully manage customer perceptions in raising
prices.
5. Companies must anticipate competitor price changes and prepare
contingent response. A number of responses are possible in terms of
maintaining or changing price or quality.
6.The firm facing a competitor's price change must try to understand
the competitor's intent and the likely duration of the change. Strategy
often depends on whether a firm is producing homogeneous or non
homogeneous products. Market leaders attacked by lower-priced
competitors can choose to maintain price, raise the perceived quality of
their product, reduce price, increase price and improve quality, or
launch a low-priced fighter line.
 SUGGESTION

The growth of real estate market in the last decade has not been impressive
mainly due to two reasons - one, the overall recession in the economy and
second, lack of government initiatives in the direction streamlining,
refining and facilitating legislation in order to excel the housing sector. In
this scenario futile provision of present housing policies receives poor
response from the private sector for housing LIG and EWS segments. To
increase participation of private sector to provide housing to these strata of
society radical changes needs to be considered.
 Pricing Strategy

REFERENCES :

• Marketing Management by Kotler and Keller

• Marketing Management – Planning , Implementation and
Control
• www.Google.com
• www.wikipedia.org
 ANNEXURE

QUESTIONNAIRE
1- Factors influence a consumer to buy
particular Brand.
1 Attractive packaging 100
2 Shop display & Advertising 60
3 Word of mouth 100
4 Dealer 80

2- Promotional Schemes affects the Purchasing Decision.

1 Strongly Agree
2 Agree
3 Neutral
4 Strongly Disagree
5 Disagree

3- Promotional scheme changes the buying decision of a Customer.

1 Money back offer
2 Prizes on bottle cap
Prizes on the specific number of
3 bottle caps.
4 Bumper Prize
4- Visual advertisements on television are more effective than
audio advertisements on Radio.
1 Strongly Agree
2 Agree
3 Neutral
4 Strongly Disagree
5 Disagree
5- Effectiveness of different advertising techniques
1 Media & Print
Media
2 Radio
3 Melas/fairs
4 Wall Painting
5 Billboards

6- Policies affecting buying selection

1 Discount Policy
Promotion
2 al Policy

7- Presence of celebrities in the advertisements influence

customer to buy a product.
1 Strongly Agree
2 Agree
3 Neutral
4 Strongly Disagree
5 Disagree

8- Effects of Advertising on sales.

Strongly Agree
Agree
Neutral
Strongly Disagree
Disagree
9- ‘Word of Mouth’ is the most important method of the
publicity and the most trusted source of communication in rural
areas.

Strongly Agree
Agree
Neutral
Strongly Disagree
Disagree

10 - Attractive packaging enables consumer to buy the product.

Strongly Agree
Agree
Neutral
Strongly Disagree
Disagree