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'UNIT 2 — PRICE DECISION Main topics in the PDF: Meaning and importance of Price Factors affecting Pricing Types of Pricing 1. Meaning of Price ⭐⭐⭐ Price = Money value of a prod…
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'UNIT 2 — PRICE DECISION Main topics in the PDF: Meaning and importance of Price Factors affecting Pricing Types of Pricing 1. Meaning of Price ⭐⭐⭐ Price = Money value of a product. It represents the amount customers pay to obtain the benefits of a good/service. VERY IMPORTANT Price is the only element of the marketing mix that generates revenue. The other three Ps involve expenditure/costs. 2. Importance of Pricing ⭐⭐⭐ To the Firm Generates revenue Determines growth Helps recover costs Helps earn profit Influences market share Helps compete in the market To Consumers Price affects: Purchasing decision Perceived value Affordability Choice between alternatives 3. Price & Other 3 Ps Product Cost of producing product influences price. Place Distribution expenses influence price. Examples: Transportation Salesmen Distribution channels Promotion Advertising and promotion expenses influence price. Therefore, the right price should cover these expenditures and provide profit. 4. Factors Affecting Pricing ⭐⭐⭐⭐⭐ Remember: INTERNAL + EXTERNAL Internal Factors Important factors include: Company objectives Cost of product Nature of product Marketing mix Organisation/managerial considerations External Factors Demand Competition Suppliers Economic conditions Government regulations Economic Conditions Boom: Higher prices may be possible. Slump: Firms may lower prices to maintain business and clear stocks. Government Regulations Government policies/regulations can restrict price increases or influence pricing decisions. 5. Types of Pricing ⭐⭐⭐⭐⭐ There are FOUR major categories: D → C → C → V Demand-oriented pricing Cost-oriented pricing Competition-oriented pricing Value-based pricing A. Demand-Oriented Pricing Price is determined mainly by customer demand. Relationship Price ↑ → Demand ↓ Price ↓ → Demand ↑ Equilibrium price is determined where: Quantity Demanded = Quantity Supplied Perceived Value Pricing Price is based on the buyer's perception of value, rather than seller's cost. Example from the PDF: Tea can have different prices in hotels/restaurants because customers perceive different values. B. Cost-Oriented Pricing Price is determined mainly on the basis of cost of production. Important methods to know from the unit: Cost-based pricing Cost-plus pricing Mark-up pricing Break-even pricing C. Competition-Oriented Pricing Price is determined with reference to: Competitors' prices Market conditions Competitive position A firm may offer a lower price to compete/out-sell competitors. D. Value-Based Pricing ⭐⭐⭐ Price is based on the value perceived by the customer. Don't confuse: Cost-oriented: Seller's cost → price Demand/value-oriented: Customer's perceived value/demand → price 6. Important Pricing Methods Market Skimming Pricing ⭐⭐⭐ High initial price is charged to recover development costs and earn high margins from customers willing to pay more. Penetration Pricing ⭐⭐⭐ Low initial price is used to: Enter the market Increase market share Attract customers Break-even Pricing Price is determined with reference to the point where total revenue equals total cost. Cost-plus Pricing Cost + predetermined profit margin = Price. Mark-up Pricing A mark-up is added to the cost to determine selling price. Leader Pricing Price is used strategically by a firm to attract customers/compete. Psychological Pricing Price is fixed by considering the psychological perception of consumers. The PDF itself lists market skimming, penetration, value-based, competition-oriented, break-even, cost-based, cost-plus and mark-up pricing among its examination questions, so these are particularly worth preparing' make all the content in '' into a ppt Follow Design: {"palette":["Imperial navy #0E1B2E — dominant brand base and dark title slide fills","Warm ivory #FAF8F5 — primary slide canvas background","Burnt amber #C86D3B — key highlights, focal metrics, and star indicators","Slate charcoal #2C3540 — primary high-legibility body text","Muted sand #EFECE6 — card container surfaces and border dividers"],"fonts":{"Newsreader":"https://fonts.googleapis.com/css2?family=Newsreader:ital,wght@0,200..800;1,200..800&display=swap","Inter":"https://fonts.googleapis.com/css2?family=Inter:ital,wght@0,100..900;1,100..900&display=swap"},"type":"Newsreader in Medium and SemiBold for authoritative, editorial lecture titles and key formulas; Inter in Regular and Medium with tight tabular alignment for structured hierarchies, comparative bullet matrices, and multi-tier lists.","layout":"Asymmetrical 12-column editorial grid with generous 72px page margins, broad anchor headers on the left third, paired comparative cards on the right, and persistent bottom-edge topic progress breadcrumbs.","framework_treatment":"Subtle hairline borders around comparison matrices, distinct split-column cards for Internal vs. External drivers, callout blocks with left amber accent bars for core exam rules, and clear 2x2 categorical quad layouts for the four pricing models.","feels_like":"A Harvard Business School strategy casebook translated into an executive lecture deck"}
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This community presentation was shared by Diya Binoj as a complete 11-slide example. 'UNIT 2 — PRICE DECISION Main topics in the PDF: Meaning and importance of Price Factors affecting Pricing Types of Pricing 1. Meaning of Price ⭐⭐⭐ Price = Money value of a prod… The preview lets you review the full sequence in order, rather than judging the design from a single cover image.
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