Pricing Strategy and Channel Distribution
Pricing Strategy and Channel DistributionDetermine and discuss a pricing strategy (Penetration or Skimming).
Pricing is very important strategic element. The pricing strategies impinge on featuring products, channel decisions, and promotions. The researcher realizes there is no real determine pricing, following a life cycle for developing the pricing of Destini’s Closet product. First, develop market strategy – which the researcher evaluated and conducted a marketing analysis to identify the market segments, target market, SWOT analysis, and the market positioning. Second, marketing mix decisions – the researcher defined the product (Clothing), contacted manufactures for distribution, and decided promotional tactics. Now the researcher is focusing on the cost productions, price of substitute products, and prices offered by the competition. The researcher notices that competitors change their prices often. Case scenario, competitors are always looking for a competitive match, this can be an advantage and a disadvantage for the business. Competitors may strategize a different packaging of their product; this can be good for Destini’s Closet by reducing their price. It’s all up to the customer wants and needs. The demographic crowd the researcher is focusing on would rather price reduction then a new look to a product. What if production price are rising? If production price is rising it’s up to the Destini’s Closet to determine the price increase without turning the customers to their competitors
Two commonly known pricing strategies are skimming and penetration. Skimming is pricing policy by the producer to sell his product with initially for high price and then at decreasing rate over the time. Price skimming strategies is fundamentally a demand for the offering either by the market as a whole or by segment. High prices can be beneficial for a short period of time when the demand of the product is inflexible. Price skimming strategy is used to target the early adopters of product and service....