BU352 Lecture 7: The 5 C’s of Pricing
Document Summary
The 5 c"s of pricing: company objectives, customers, costs, competition, channel members, company objectives. Each firm embraces an objective that seems to fit where management thinks the firm needs to go to be successful. Usually reflects how the firm intends to grow; increase sales, decrease competition, build customer loyalty etc. Sales orientation a company objective based on the belief that increasing sales will help the firm more than will increasing profits. Competitor orientation a company objective based on the premise that the firm should measure itself primarily against its competition. Value is only implicitly considered when pursuing competitor orientation: competitive parity set prices that are similar to those of major competitors. Customer orientation explicitly invokes the concept of value and sets prices to match consumer expectations. Could be a low price if that"s what the firms target market values or could be a high quality luxury product with a high price point: customers.
