MKC1200 Study Guide - Final Guide: Price Ceiling, Price Floor, Marketing Week
8 Aug 2018
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The value exchanged for a product in a marketing transaction: the most flexible element in the marketing mix, directly relates to the generation of revenue (all other elements incur costs, pricing = the management of price. Profit = (price x quantity sold) total costs. Prices should be consistent with the organisation"s goal and mission. If a diff bw estimated demand and cost levels, a price that produces more profit, cf and roi will be chosen. Ongoing survival when high competition, changing customer needs, major. Highest market share = lowest costs = highest profit in the lt. If aim is to position themselves as premium, set high prices. Selecting the pricing method: price must reflect the product"s value to the customer, the value obtained from the exchange can cover the product"s cost, price must allow products to be competitive in the marketplace.
