Impact on Pricing Decisions Faced by marketers

Impact on Pricing Decisions Faced by marketers

Introduction

It is aphoristic that price possesses a distinct part inside the business since only it specifically produces incomes: all other marketing mix factors experience an expense. However, how good the marketing campaign, the pricing plays the important role in the business. Whereas, pricing can create value brand value or incur a loss to a business if pricing is not covered the cost of production (Jobber, & Shipley, 2012). Pricing strategy can possibly be of foremost important factors for the marketers of the business. Rao (1986) has claimed that from all the marketing mix, pricing strategy plays an important role in marketing decisions.

Literature Review

Business marketers should consider the factors that impact the product or service when using high or low pricing strategies. Some factors as marketing orientated which has the connection from the customer point of view on the product or service and some other factors from market and competitors (Jobber, & Shipley, 2012).

Meanwhile, When different business uses different pricing for the same product (Bolton et al , 2003). As the result, allowing customers to become aware of the pricing on the market and customers will trend to shift to brands with low price.

Marketers believes that there is a strong relationship between brand value and price where businesses set the price of a product or service by the value of the brand. This could impact on the business by the losing customers when setting the price high. Customer trend to shift brands according their willingness.

Impact on contemporary marketing

The impact on the current marketing as Choi and Mattila (2005) highlighted the importance for the marketers about how pricing interconnect with consumers. Therefore, as price variable rate is familiarized, businesses should effectively fix the price to connect their customers.

In the case of Woolworth, Coles and other supermarket sell the same product but at different price, this has an impact on these business as customers trends to shift the retail stores. However, loyalty customer still pays for the price the business set.

Moreover, marketers of the Apple have set up standard price to meet up the brand value, yet these device can be sold for lower price as Oppo mobile company which produce similar product.

References

Bolton, L., Warlop, L., & Alba, J. (2003). Consumer Perceptions of Price (Un)Fairness. Journal Of Consumer Research, 29(4), 474-491. http://dx.doi.org/10.1086/346244

Choi, S. (2005). Impact of Information on Customer Fairness Perceptions of Hotel Revenue Management. Cornell Hotel And Restaurant Administration Quarterly, 46(4), 444-451. http://dx.doi.org/10.1177/0010880404270032

Jobber, D., & Shipley, D. (2012). Marketing‐orientated pricing. European Journal Of Marketing, 46(11/12), 1647-1670. http://dx.doi.org/10.1108/03090561211260022

Rao, V. (1984). Pricing Research in Marketing: The State of the Art. The Journal Of Business, 57(S1), S39. http://dx.doi.org/10.1086/296235