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