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Types Of Pricing Techniques And Branding

Discuss anything to do with property law - buying, selling property

Types Of Pricing Techniques And Branding

Postby Aziel » Sat Dec 03, 2016 5:49 pm

a) Explain 2 different types of pricing techniques. As a consumer which method do you personally prefer to deal with? Justify your answer.

b) Explain how branding can benefit a tourism/hospitality organisation

c)Explain Ansoff’s product-market expansion grid and discuss its importance for Marketing Managers.
Aziel
 
Posts: 48
Joined: Tue Dec 31, 2013 11:42 pm

Types Of Pricing Techniques And Branding

Postby Redvers » Sun Dec 04, 2016 6:59 pm

a) Explain 2 different types of pricing techniques. As a consumer which method do you personally prefer to deal with? Justify your answer.

b) Explain how branding can benefit a tourism/hospitality organisation

c)Explain Ansoff’s product-market expansion grid and discuss its importance for Marketing Managers.
Redvers
 
Posts: 56
Joined: Sun Jan 12, 2014 8:27 pm

Types Of Pricing Techniques And Branding

Postby Balldwin » Mon Dec 05, 2016 6:55 am

TEVIN,

HERE  IS SOME USEFUL  MATERIAL.

REGARDS

LEO LINGHAM

=============================== a) Explain 2 different types of pricing techniques. As a consumer which method do you personally prefer to deal with? Justify your answer.

1.TARGET  BASED  PRICING  IS  A  MECHANISM  WHEREAS  PRICE  ARE  SET

BASED  ''MARKET   PENETRATION''  OR  PRICE  POINTS   RATHER  BUILDING

FROM  STANDARD  COST.

ADVANTAGES.

-it is market  segment  oriented.

-it  is based  on  fixed  target  market.

-it  is  linked  to  the  position of the  product in  the  market

and  easy  to  evaluate  the  performance.

-it  is  linked  to  the product  functions / features/ benefits.

-it  is relative  to the competitive  position of the  product.

-it  is  sensitive to the  consumer  buying  decision,

in  the  target  market.

-the  consumers  can  relate to  the  price in  the  target  market.

-this  approach  helps to  improve sales/ gain  market share.

------------------------------------------------------------------------

DISADVANTAGE

-if  the  sales  volume  go up significantly, the  operational cost go up too,

and  hence  could  shrink  the  profit  level.

-it  is  only  a short  term  solutions.

-it  lacks  flexibility.

-if  the  competition increases, the marketing cost goes up

and will have  a  negative  impact  on  profit.

===============================================

2.Value based pricing. It sets selling prices on the perceived value to the customer, rather than on the actual cost of the product, the market price, competitors prices, or the historical price.

The goal of value-based pricing is to align price with value delivered. Price for any individual customer can be customized to reflect the specific value delivered. Examples could include metrics such as number of users, number of annual transactions, size of revenues, cost savings, or other measurements. Value based pricing typically enables companies to become more competitive and more profitable than using simpler pricing methods.

Value-based pricing is dependent upon an understanding of how customers measure value, through careful evaluation of customer operations or feedback to a survey. The survey methods used to determine the value, and therefore the willingness to pay, a customer attributes to a product or a service are Relative Attribute Positioning, Value-based pricing is a method of pricing products in which companies first try to determine how much the products are worth to their customers. The goal is to avoid setting prices that are either too high for customers or lower than they would be willing to pay if they knew what kind of benefits they could get by using a product. Data mining software can play an important role in the process by helping users segment their customers and define the value they receive.

This focuses on the price you believe customers are willing to pay, based on the benefits your business offers them.

Value-based pricing depends on the strength of the benefits you can prove you offer to customers. If you have clearly-defined benefits that give you an advantage over your competitors, you can charge according to the value you offer customers. While this approach can prove very profitable, it can alienate potential customers who are driven only by price and can also draw in new competitors.

ADVANTAGES.

-it  can be  made  flexible  to suit  the  market  conditions.

-it  can be  tuned to  take  the  advantages in  the  market.

-it can  be positioned in  a  competitive  way.

-it  can  be  lowered  to match  the  competition.

-you  can  offer  volume  discounts.

-if  the  market  segment  is  affluent, you  can charge more.

Discounting

Offering specially-reduced prices can be a powerful tool. This could be a clearance discount to sell old stock, a discount for making multiple purchases of the same or similar products, or you could offer bulk discounts to encourage larger orders. You should be able to make these more profitable through lower costs.

Odd value pricing

Using the retailer's tactic of selling products for £9.99 instead of £10 can be useful if price is an essential part of customers' buying decisions. Some customers perceive odd value prices like this as being more attractive.

Loss leader

This involves selling a product at a low or even loss-making price. Although you may not make a profit selling this product, you could attract customers who will also buy other, more profitable products.

Skimming

If you have a unique product or service, you can sell it at a high price. This is known as skimming - but you need to be sure that what you are selling is unique. Otherwise you may just price yourself out of the market if there is credible competition.

Penetration

This is the opposite of skimming - starting at a low price and gaining market share before competitors catch up with you. Once you have a loyal customer base, you should be able to find ways to raise prices later. DISADVANTAGE

-you must  conduct  continual  marketing  research, at  a  cost,

to monitor  the  situation.

-one  minor  bad judgement, could  affect  your  profit  position.

================================================

@@@@@@@@@@@@@@@@@@@@@@@@@@@@@

FOR  ANY  ORGANIZATION,

BOTH   ARE  NEEDED  AND  USEFUL.

YOU  GOT  TO  USE  IT, AS  PER  THE  MARKET  SITUATIONS.

IT  IS NOT  THAT, ONE  IS  SUPERIOR   THAN OTHER.

==================================================

AS  A CONSUMER,  I  PREFER   ''VALUE  ADDED  PRICING''

-it matches  with  the  product  purchase.

-you  gain  satisfaction for  the  price  paid.

-you  feel  you  get  value  for  money.

-you  can get  volume  benefits.

-you don't  feel  you have  been  cheated.

etc

#################################################

b) Explain how branding can benefit a tourism/hospitality organisation

IN  THE  FIRST  STAGE,  FOCUS

COUNTRY   BRANDING

Country branding is a synonym for nation branding. Nation branding is a better term because it shows a clear understanding that it's the people who brand their country, who benefit from an improved national reputation, and who truly 'own' that national brand. TWO  FACTORS  ARE  INVOLVED

1.COUNRY  OR  DESTINATION  BRANDING.

destination branding is a fancy word for tourism promotion. Proper brand management is certainly a a powerful tool for tourist boards and is long overdue for adoption in many countries, that the overall reputation of the country has to be measured, managed and influenced by a partnership between tourism, culture, government, business and civil society. Simply doing better tourism promotion might attract more tourists, but it won't do nearly as much to affect the 'nation brand' as when all the stakeholders work together around a single, visionary national strategy. 2.PRODUCT BRANDING

===============================================

COUNTRY  BRANDING

Principles of branding apply in equal measure to

countries as they do to corporations. But methods are

different. Countries will compete daily with neighbors

or block regions for tourism, inward investment and

export sales. There’s only so much business that can

go around. Those countries that start with an unknown

or poor reputation will be limited or marginalized. They

cannot easily boost their commercial success.

Consequently, they will often languish at the bottom

of the ladder of influence. No voice or even worse,

they are the butt of jokers at every regional summit.

Similarly, when the reputation is clear and positive

such as with Germany(and that’s despite two world

wars), products made in that country carry an extra

aura. The brand equity they possess opens doors and

wins contracts. Take the European car business -

while mass car buyers all over Europe show a

preference for indigenous brands(Citroen/ Renault

in France, Seat in Spain etc.) the number two choice

invariably is a car made in Germany, and it doesn’t

necessarily mean a BMW or Mercedes.

Creating a branding program for a country demands

an integration policy that most countries do not possess-

the ability to act and speak in a coordinated and

repetitive way about themes that are the most motivating

and differentiating a country can make. Which

countries bother really to understand and act on this?

The identification of key issues is an emotionally

charged debate as who can really decide whether tradition

or radicalism is the more motivating?

Ireland and Scotland are widely acknowledged as having

created country brands that punch far above their

natural weight. Part of the reason for this is that they

are in the so-called ‘tiger club’, small, cocky fighters

who use the illusion of an enduring enemy to create a

strong brand identity for themselves as the underdog.

In the case of Scotland for instance they even used an

advertising line called ‘Scotland the Brand’(replacing

Scotland the brave), also, the Scottish Culture Board

has sent Hollywood a training course in Scottish

dialect to make sure that authentic accents are the

only ones we hear on the big screen(the end of

‘Scottie’ from Star Trek perhaps).

Ireland enjoyed an enormous surge in popularity on

the back of numerous Eurovision Song Contest wins

and famed shows such as River Dance. And of course,

Guinness is the quintessentially Irish Brand that at

once feeds the reputation of Ireland as Ireland, the

country brand, feeds it.

The benefits of a consistent and professional country

branding can be observed in every region- they

include the ability to win more investment business

because the country image says the right things about

taxation, labor skills, safety, the environment, political

stability plus the chance to apply a ‘made in’ label

because it will positively aid the sale of a product in an

overseas market.

So how do you go about branding a country?

***** You have to have the cooperation and involvement of

representatives of government, business, the arts,

education and importantly the media. The media will

go crazy to be involved because branding a country

is a good opportunity to settle old scores and hit the

political debating table hard. Don’t launch a country

branding project if you don’t want to spend a lot of

time answering questions - you’ll get plenty.

*****You need to find out how your country is perceived

internally and by people abroad who you want to

influence. Use qualitative and quantitative methods. If

it’s for a product such as wine then some dimensions

in a country brand may be less important than

others - for instance people joke about national

characteristics and the British often say they find it

hard doing business with the French but when it

comes to wine consumption, the British do consume

vast quantities of Champagne and are most knowledgeable

about French wine.

*****Consult with opinion leaders to look at national

strengths and weaknesses and compare them with

the research you do.

*****Create a strategy which should include some kind of

professional model for the brand and the way that

the brand idea will be communicated, bearing in

mind that different audiences will need different

takes(tourism is usually quite different to investment

although they obviously connect).

*****Work out a program to make the strategy tangible

through improvement programs, campaigns etc.

Make sure you can point to tangible examples of

brand enhancement otherwise the media will have you

in the spotlight for wasting time and money. People

want their country to have the best physical impression

at ports of entry, city centers, etc. Look at how Rudolf

Giuliani transformed the external visitor impression of

New York from scary city to one of the safest places in

the world.

*****Create a system to link together the different

organizations and departments that can be part of

your brand but remember that if it all looks too

governmental then people will avoid working with it.

This is a big challenge. The government needs to drive

support for the initiative but shouldn’t try to take all

the accolades, otherwise, unless it’s a dictatorship, all

you’ll end up with is a number or rebranded ministries

and government bodies.

*****Most of all, its actions that really count. You can’t

impose branding on a country but you can find out

the aspects that appeal to the widest group of people

and which are different and special. Take time,

be consistent, build an integrated picture and always

back it with quality. You will have success.

As a final example, look at Spain, a great piece of

repositioning from a country on the edge of modern

European dynamics to one right at the heart. A brand

based on passion and a wonderful identity that connects

itself through multiple links and layers so it has

become the most recognized country mark in Europe

Brands truly have the power to

change the world, they have the power to change the

way we view the world and how we choose to see one

country in contrast to another. The business of country

branding is deeply serious.  Those

who employ professional skills with a determination to

measure, evaluate and communicate can achieve outstanding

economic results.

=========================================================

PRODUCT  BRANDING

BRANDING   IS  VERY  IMPORTANT  TODAY, FROM BOTH

SIDES  OF  THE  MARKETING  EQUATION.

FACTOR   ONE --MARKETERS' SIDE

THE  REAL  APPLICATION  OF  MARKETING  THEORY BY  THE  MARKETERS.

THE  MARKETERS  CREATE  A  PLATFORM  FOR  THEIR  PRODUCT'S BRAND

THROUGH

-symbol / logo / fonts/ color/ sound.

-product features/ benefits/ quality/ certainty/ reliability/delivery/ packaging/design.

Favorable brand attitudes are the determinants of brand loyalty - consumers must like the product in order to develop loyalty to it. In order to convert occasional purchasers into brand loyalists, habits must be reinforced. Consumers must be reminded of the value of their purchase and encouraged to continue purchasing the product in the future. To encourage repeat purchases, advertisement before and after the sale is critical. In addition to creating awareness and promoting initial purchases, advertising shapes and reinforces consumer attitudes so these attitudes mature into beliefs, which need to be reinforced until they develop into loyalty.  Ads reinforce consumer's  perception and behavior. Remember, it is easier to reinforce behaviors than to change them and the sale is just the beginning of an opportunity to turn the purchaser into a loyalist.

THE  MARKETERS   ADOPT  THE  FOLLOWING  TO  DEVELOP  BRAND  LOYALISTS.

Develop an unbeatable product - if you want to keep customers, make sure they can get what they want from your product. Give customers an incentive to repeat-purchase - chance to win a prize, gift with a certain number of proofs of purchase, in-pack discount coupon, etc. Stand behind your product - if customers don’t trust the product, they won’t purchase it again. Know your trophy customers and treat them best of all .

Make it easier to buy your brand than competing brands - availability and simplicity are keys in today’s high-speed world. Customers appreciate convenience more than ever. Go to your customers - bring the product to customers when possible. Become a customer service champion - seek to serve the customer and they will repeat-purchase…again and again! ========================================================================

FACTOR   SECOND-----BUYERS'  SIDE

ON   THE  OTHER  SIDE  OF   THE  MARKETING  EQUATION.

Brand loyalty is a consumer’s preference to buy a particular brand in a product category. It occurs because consumers perceive that the brand offers the right product features, images, or level of quality at the right price. This perception becomes the foundation for a new buying habit. Basically, consumers initially will make a trial purchase of the brand and, after satisfaction, tend to form habits and continue purchasing the same brand because the product is safe and familiar.

CORE  BRAND  LOYALISTS  seek  distinct advantages: products  are perceived as effectively differentiated from their competitors. products  satisfy consumer needs on both intellectual and emotional levels. products  consistently deliver on their brand promise, thus they consistently deliver value. When brands resonate with customers at this level, there is a powerful emotional relationship in place. This is the key element that leads to loyalty. THE  PRODUCT  OFFERS,  EXACTLY,   WHAT  THE BRAND  LOYALISTS SEEK:

-product  distinctiveness

-product  perceived  quality

-product value  for money.

-product  permeation

-product  personality

-product  competitive  innoculation

-product's   perceived  potential

=========================================

"BRAND Value" has different interpretations: 1.from a marketing or consumer perspective it is "the promise and delivery of an experience"; To marketers, brand equity = retained customers

2.from a business perspective it is "the security of future earnings"; To financiers, brand equity = retained earnings. 3.from a legal perspective it is "a separable piece of intellectual property." Brands offer customers a means to choose and enable recognition within cluttered markets.

=====================================

WHY   BRANDING  IS  IMPORTANT FOR   A    PRODUCT  TO  BE  SUCCESSFUL,  IT  MUST

-bring continuous  sales

-gain market share, -win consumer  preference

-build  loyalty

-raises  the  relative  price.

WHICH   RAISES  THE   EQUITY/   BRAND  EQUITY  OF  THE   PRODUCT

THAT  IS  WHY  BRANDING  IS  SO  IMPORTANT.

=======================================================

FOR   A    PRODUCT,  WE   CREATE  A  BRAND  IDENTITY

THROUGH

-symbol / logo / fonts/ color/ sound.

-product features/ benefits/ quality/ certainty/ reliability/delivery/ packaging/design.

WITH   WHICH    WE  CREATE  

-a  perception  through

-a  visual/ communication/ behavior

WHICH   RESULTS  IN   A   BRAND  PERSONALITY

WHICH   CONSISTS  OF -BRAND  PERMEATION

-BRAND  DISTINCTIVENESS

-BRAND  VALUES

-BRAND  IMAGE

WHICH  HELPS  TO  DEVELOP   

1. BRAND  PLATFORM, WHICH  INCLUDES

-vision

-mission

-value

-personality

-positioning  

-strategy

2.BRAND  ARCHITECTURE,  WHICH  INCLUDES

-association

-commitment

-earnings

-essence

-identity

-extension

-harmonization

-image

-licensing

WHICH   CREATES   FOR  THE    PRODUCT

-sales

-market  share

-consumer  preference

-builds  loyalty

-raises  relative  price

WHICH  RAISES  THE    PRODUCT BRAND  EQUITY

-distinctiveness

-perceived  quality

-value

-permeation

-personality

-competitive  innoculation

-potential

########################################################

c)Explain Ansoff’s product-market expansion grid and discuss its importance for Marketing Managers.

The Product/Market Grid of Ansoff is a model that has proven to be very useful in business unit strategy processes to determine business growth opportunities. The Product/Market Grid has two dimensions: products and markets.

Over these 2 dimensions, four growth strategies can be formed.

IF  THE  BUSINESS  ORGANIZATION  DECIDES  ON  THE  STRATEGY

OF  DEVELOPMENT  WITHIN  THE   EXISTING  LINES  OF  BUSINESS,

THEN

The Product/Market Grid of Ansoff is a model that has proven to be very useful in business unit strategy processes to determine business growth opportunities. The Product/Market Grid has two dimensions: products and markets. THE     TWO   DIMENSIONS   ARE

1. MARKET /PRODUCT    AND   2 . EXISTING  / NEW

Over these 2 dimensions, four growth strategies can be formed.

1.existing  products in the  existing  market. = MARKET  PENETRATION.

2.existing  products  in the  new market = MARKET  DEVELOPMENT.

3.new  products  in the  existing  market = PRODUCT DEVELOPMENT.

4.new  products  in the  new  market = DIVERSIFICATION.

four growth strategies in the Product/Market Grid

four growth strategies in the Product/Market Grid   1. Market Penetration. Sell more of the same products or services in current markets. These strategies normally try to change incidental clients to regular clients, and regular client into heavy clients. Typical systems are volume discounts, bonus cards and Customer Relationship Management. Strategy is often to achieve economies of scale through more efficient manufacturing, more efficient distribution, more purchasing power, overhead sharing.   2. Market Development. Sell more of the same products or services in new markets. These strategies often try to lure clients away from competitors or introduce existing products in foreign markets or introduce new brand names in a market. New markets can be geographic or functional, such as when we sell the same product for another purpose. Small modifications may be necessary. Beware of cultural differences.   3. Product Development. Sell new products or services in current markets. These strategies often try to sell other products to(regular) clients. These can be accessories, add-ons, or completely new products. Cross-selling. Often, existing communication channels are used.   4. Diversification. Sell new products or services in new markets. These strategies are the most risky type of strategies. Often there is a credibility focus in the communication to explain why the company enters new markets with new products. On the other hand diversification strategies also can decrease risk, because a large corporation can spread certain risks if it operates on more than one market. Diversification can be done in four ways:          * Horizontal diversification. This occurs when the company acquires or develops new products that could appeal to its current customer groups even though those new products may be technologically unrelated to the existing product lines.          * Vertical diversification. The company moves into the business of its suppliers or into the business of its customers.          * Concentric diversification. This results in new product lines or services that have technological and/or marketing synergies with existing product lines, even though the products may appeal to a new customer group.          * Conglomerate diversification. This occurs when there is neither technological nor marketing synergy and this requires reaching new customer groups. Sometimes used by large companies seeking ways to balance a cyclical portfolio with a non-cyclical one.

Although the Product/Market Grid of Ansoff is already decennia old, it remains a valuable model for communication around business unit strategy processes and business growth. #################################################  
Balldwin
 
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Joined: Wed Jan 08, 2014 12:28 pm


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