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20 Cards in this Set
- Front
- Back
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The Five C's of Pricing
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Company Objectives
Customers Costs Competition Channel Members |
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Company Objectives
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Profit Orientation
Sales Orientation Competitor Orientation Customer Orientation |
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Profit Orientation
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comapany objective implemented by focusing on target profit pricing, maximizing profits, or target return pricing
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Sales Orientation
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believe increasing sales will help firm more then increasing profits
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Competitor Orientation
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strategy which firm bases themselves against their competition
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Custome Orientation
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set prices to match customer expectations
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Customers
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Demand Curve- shows number of units consumers want during a specific time
Elasticity of Demand- measures how prices affect quantity demanded Cross Price Elasticity- price of DVD players go down, demand for DVD's will go up |
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Costs
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Variable Costs
Fixed Costs Total Costs |
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Variable Costs
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costs that vary with production
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Fixed Costs
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costs that remain the same
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Total Cost
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Sum of the variable and fixed costs
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Break Even Analysis
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technique that lets managers examine the relationships among cost, price, revenue, and profit over different levels of production/sales
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Competition
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Oligopolistic Competition
Monopolistic Competition |
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Oligopolistic Competition
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Few firms dominate
changes in price in response to competition to maintain stability price war: 2 or more firms compete primarily with lowering prices |
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Monopolistic Competition
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Many firms competing for customers in a market but their products are differentiated
Pure Competition- different companies that consumers percieve as substitutable sell commodity products |
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Channel Members
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Manufacturers
Wholesalers Retailers Different views on pricing |
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Channel Members
Gray Market |
irregular but not illegal methods. gnerally, legally circumvents authorized channels of distribution to sell goods at prices lower than those intended by manufacturer
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Macro Influences on Pricing
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The Internet
Economic Factors |
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The Internet
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made products more price sensative
search engines growth of online auctions |
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Economic Factors
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Disposable Income and Status Consciousness
Cross Shopping Economic Environment |
