In addition to gathering data on the size of markets, companies must try to determine how price sensitive customers are. Image of the firm: A company must take into account all three levels of competition. Raise your—fares twenty percent.
Similarly, if a customer of one of its premium brands wants to trade down, it encourages him to buy one of its value brands.
To a large extent these factors are controllable by the company and, if necessary, can be altered. There are many factors that will have an influence on how you set the price for your product or service, with some of them internal and some external, and most of them will fluctuate over time.
Fixed costs Overhead or costs that remain the same regardless of the level of production or the level of sales. Companies offering e-mail service are competitors at the third level of the telephone company. Figuring out how consumers will respond to prices involves judgment as well as research.
Think about a pair of sweatpants with an elastic waist. Next we look at each of the factors and what they entail. Customers How will buyers respond.
It launches a low price fighter brand to compete with low price competitor brands. The intent of the act is to protect small businesses from larger businesses that try to extract special discounts and deals for themselves in order to eliminate their competitors.
The number of competing products and substitutes available affects the elasticity of demand. The pricing of the product is also affected by the credit period offered by the company.
But, it is not easy to maintain a portfolio of brands in the same product category. However, while the organization may have control over these factors making a quick change is not always realistic. You perhaps have seen bait-and-switch pricing tactics used to sell different electronic products or small household appliances.
Competition A competitive pricing strategy, where prices for a product or service are set based primarily on the prices of the competition, is best suited for a price-sensitive and highly competitive market.
The first level of competitors offers technically similar products. If total costs exceed total revenue, the company suffers a loss. The point at which total costs equal total revenue is known as the breakeven point BEP The amount in units or dollars where total revenue equals total costs.
External Factors — There are a number of influencing factors which are not controlled by the company but will impact pricing decisions. The entry of competitors in hordes puts tremendous pressure on price and the pioneer company is forced to reduce its price.
Their conversation went like this: But once it sinks in that they are being affected adversely by the pricing moves of a company that seemingly belongs to another industry, they will take swift retaliatory actions. The consumer factors that must be considered includes the price sensitivity of the buyer, purchasing power, and so on.
At a later stage, it produces a range of brands at different price points, which serve segments of varying price sensitivities. Video systems, LCD liquid crystal display manufacturers, auction houses, and airlines are examples of offerings in which price fixing existed.
But increasing productivity may require substantial changes at the manufacturing facility that take time and are potentially costly and will not translate into lower price products for a considerable period of time.
This research will find out that what are the key factors that can affect on mobile sales by using iPhone product and focusing on young people.
which is 50% and then followed by feature, brand and trend at 40%, 20% and 20% in order. As a result, it shows that the mobile phone company should pay the importance to application and feature.
Start studying marketing chapter 9. Learn vocabulary, terms, and more with flashcards, games, and other study tools. external factors that could affect pricing decisions.
affecting factors of international company price decisions. 1. economic conditions. Jun 27, · Many mobile carriers, for example, sell cell phones at hugely discounted rates so that consumers will sign on for one of their cell phone service packages.
"Factors Influencing Pricing. Environmental Analysis Of Mobile Phone Industry Marketing Essay. Print Reference this. Inflation is also one of external factors affecting the company, therefore this issue must be considered because the company has no power over it (whereby money loses its value).
What range of pricing would you prefer for a phone with good features.
Start studying marketing chapter 9. Learn vocabulary, terms, and more with flashcards, games, and other study tools. external factors that could affect pricing decisions. affecting factors of international company price decisions.
economic conditions. The pricing decisions for a product are affected by internal and external factors. A. Internal Factors: 1. Cost: While fixing the prices of a product, the firm should .External factors affecting mobile phone pricing