Apple Pricing Strategy Essay

9001 Words Sep 6th, 2012 37 Pages
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Essay Sample: Page 2
1.1. Internal factors

Overall marketing strategy, objectives, and Mix Organizational considerations

a) Customer Value- Based Pricing: uses buyers’ perceptions of value, not the seller’s cost, as the key to pricing. It means that the marketers cannot design a product and marketing program and then set the price. There are two types of value-based pricing: good-value pricing and value added pricing. Good-value pricing is the offering the right combination of quality and good service at a fair price. Value-added pricing is attaching value-added features and services to differentiate a company’s offers and charging higher prices.

b) Cost-based pricing: Setting prices based on the costs for producing, distributing, and selling the product plus a fair rate of return for effort and risk.

c) Competition- based Pricing is setting prices based on competitors’ strategies, prices, costs, and market offerings.

d) New-product pricing strategies: usually change as the product passes through its life cycle. The introductory stage is especially challenging. Companies bringing out a new product face the challenge of setting prices for the first time. They can choose between two broad strategies: market- skimming pricing and market-penetration pricing.

e) Product Mix Pricing Strategies: the strategy for setting a product’s price often has to be changed when the product is
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