Final Plan - Pricing
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Pricing is an incredible marketing tool. Knowing the exact price you should charge would means the difference between financial losses, mediocre sales, or huge increases in revenues. The reason why so many products fail or produce is because business owners, corporations and marketers do not know the exact right price to charge before a launch, after a launch, or what to change the price to when there are many new competitors, not to mention the stiff competition being faced by business nowadays.
One of the elements in marketing mix is price (Marketing, 2004). This is important strategic issue because it is associated to product positioning. Additionally it influences other marketing mix elements such as channel decisions, product features and promotion. While there is no single guidelines and methods to establish and resolve pricing, the following is a all-purpose procedure of steps that might be followed for developing the pricing of a new product: First is develop marketing strategy. This means that one has to perform marketing analysis, segmentation, targeting and positioning. Second, make a marketing mix decision which involves defining the product, distribution and promotional tactics. Third, is estimating the demand curve. This means to understand how quantity demanded varies with price. Fourth, calculate cost which includes fixed and variable costs associated with the product. Fifth, understands environmental factors and evaluate likely competitor actions, understand legal constraints, etc. Sixth, set pricing objectives like profit maximization, revenue maximization or price stabilization (status quo). Lastly but not the least, determine pricing using information collected in the above steps, select a pricing method, develop pricing structure and define discounts.
Organizations operating in multiple locations across the globe have to give attention to their product planning policies. The fine distinction of customer behavior and customer likes and dislikes diverge across cultures. Furthermore, different cultures support different kinds of lifestyles. This is also important in order to determine whether the product is safer to the environment and to the consumers using it. Creating products need careful consideration and has to inform the consumers about the strategy being adapted to the product and how it is implemented. Product policy includes information’s and guidelines in using the products.
Channels of Distribution
Distribution is also vital in the marketing world. This is all about getting the product and services to the right people at the right time with special consideration for profit and effectiveness (Marketing and Sales, 2005). Successful marketing does not end when a business has created a product or service and has found its suitable target audience with a view to selling it at the right price. The next concern that needs to be faced is how they are going to distribute and market this product or service to the customers. When a product or service is acquired and bought by a consumer, it may have been purchased directly from the business or it may have been through a number of intermediaries which includes wholesaler, retailer etc. which are also known and called as the channels of distribution. Businesses, big and small alike need to concede the various types of distribution channels to exploit sales potential. Moreover, distribution channels are induced for the most part by the type and size of the business and so some of the channels explained may not be viable and possible for a finicky and fastidious business. As a result, these channels could be espoused in the future to accommodate for any changes and to help business grow and develop in the incoming future. Intermediaries and selling methods includes direct on-site which is very common for small business, products and services (Marketing and sales). This can be sold directly to the consumer directly from shop, office or home by consumers physically coming into the area to make a purchase. Another intermediaries or selling method is direct mail, which is also known as a mail shot. This type of marketing can produce sales on local, national or even global, scale. Its methods involve send out flyers, leaflets, brochures or catalogues and often target to particular consumers to selling the product or service. Another type is the telemarketing which is done through the phone and e-commerce with the aid of the internet.
Customer Relationship Management
Catching the attention and keeping lucrative and cost-effective customer relationship is by no means easy. Today, however, shielding, defending and increasing the economic value of the customer franchise seem even arduous and grueling. Novel industry dynamics, altering customer demographics and minimized or insufficient or derisory marketing resources present executives with more intricacies, more ambiguity and more threats. Basically customer relationship management is an information industry term for methodologies and internet capabilities that help an enterprise manage customer relationships in an organized and efficient manner (WhatIs, 2005). Customer relationship management includes aiding an enterprise to enable its marketing departments to distinguish and make out and at the same time target their best customers, manage marketing campaigns with clear goals and objectives, and generate quality leads for the sales team. It also involves assisting the organization to improve telesales, account and sales management by optimizing information shared by multiple employees and streamlining existing processes. Then, allowing the information of individualized relationship with customers, with the aim of improving customer satisfaction and maximizing profits, identifying the most profitable customers and providing them the highest level of service. Lastly, customer relationship management involves providing employees with the information and processes necessary to know their customers, understand their needs, and effectively build relationship between the company, its customer base and distribution partners.
Marketing (2004). Pricing Strategy. Internet Center for Business and
Marketing and Sales (2005). Distribution Channels. UK:Bizhelp, ROK Connect