Using research, explain what you think would be the most appropriate pricing method and why for two branded products below. In doing so, you must compare and contrast the two pricing methods explaining why you think they would be similar or different. You must illustrate your arguments using estimates of costs and other figures for the products you have chosen. In that case, it is quite acceptable to invent some reasonable numbers rather than take the time to research them. These detailed calculations should be in an appendix and not part of the 4 pages analysis of the two products. Demonstrate your understanding of marketing concepts central to the question. Develop an effective pricing method through the analysis of this case.
The two products can be chosen from the following.. and use only one product in each:
- media distributor
- canned vegetables
I will outline the pricing structures I would recommend and provide some basic pricing information for you to work from.
Media: I would choose Redbox and its pricing structures. Redbox solves the problems of people who do not have the internet or prefer to not buy monthly services from Hulu and Netflix, among other companies. They provide customers with convenient kiosks, placed in convenient outlets such as post offices, drug stores, convenience, and other retail outlets. From these kiosks, customers may choose movies, television DVDs, or games for their machines. The company offers games and entertainment for all levels of abilities and all age groups.
A company sets prices so more people will buy the product and gain more market share quickly. With the higher market share, the company hopes to get many more loyal customers, willing to pay a higher price in the future. Sometimes the target is to enter the market in a low-cost way to gain these customers. It can also be used to enter a market, region. Companies that want to enter new markets will offer low prices or introductory prices to gain some market share and high visibility.
Redbox rentals should be placed at penetration pricing. This will help to gain customers in a highly competitive industry. The rentals should be priced to gain the most customers, ...
The following posting discusses appropriate pricing methods for branded products.