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- µwhat a person pays for what he gets¶
- µprice is the amount of money and/or other items with
utility needed to get the desired product or services¶

ð |


- µRefers to an act of determining the exchange value
between what the buyer gets and what the seller
receives¶

- It is a process of setting proper prices for various

products and services
ð   
- µsimply ,it¶s a way of doing thing¶
- It entails specifying the organization's
mission, vision and objectives, developing
policies and plans in order to get the
competitive advantages over its
competitors.
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ð iccording to |%
&
! & , ³marketing objectives can

be expressed in terms of maximization of current profit,
achieving a target return, maximization of long-term
profits , maximization of sales growth , maximization of
market skimming , maintaining status-quo and
constituting a quality leader.´

ð |rofit oriented objectives

ð Sales oriented objectives
ð Status-quo objectives
ð Quality oriented objectives
ÿ '  |


  

   
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ð °harging a high price initially
and reducing the price over time

ð High price ,low volume to skim

the profit from the market

ð Suitable for innovative products

that have short life cycles or
which will face competition at
some point in the future
u
   

  

    

 ð Examples include: |lay station,
jewellery, digital technology,
new DVDs, etc.
ð !
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ð º!

((
  

-This strategy permits the company to charge a high price for innovative
products
-Reasons behind charging high price is to recover incurred heavy expenses
on product research and development as early as possible

ð &*
((
  

-This strategy allows the company to charge a high price for the products
about which consumers are aware. But this price should be parallel or close
to the competitors price
-By adopting this strategy, the company wants to recoup the cost of product
modification
|   
|


 |   
|



ð |rice set to µpenetrate the market¶ charging a low price when

entering the market to capture market share

ð Used when competitors are closing in with similar or better

products

ð µLow¶ price to secure high volumes

ð Typical in mass market products ± chocolate bars, food stuffs,

household goods, etc.

ð Suitable for products with long anticipated life cycles

ð Useful in launching a product into a new market

ð !
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  :

ð º!
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- Strategy is used in case products are imitative in nature but the

company tries to achieve rapid market expansion

- market size for the product is large and most of the buyers are price
conscious ,this strategy allows the company to charge lower prices

ð &*!   


- This strategy also permits the company to set lower prices, however
the company wants to expand its highly price conscious consumers,
both product aware and some potentials.
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ð |ricing somewhere in between the skimming

strategy and the penetration strategy

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ð The products value to the end user.

ð Speed at which imitation possible by
competitors.
ð |resence of close substitutes.
ð The effect of price on volumes (elasticity) &, in
turn, on costs
,