The objective is to conclude your study of the Marketing Mix by discussing pricing relative to the organization you chose for your Session Long Project. Though treated as a separate activity, your discussion of your organization's pricing strategies should fit with the other strategies.
Wal-Mart is the organization that applies to this assignment.
Describe the pricing strategies and tactics of your chosen organization using the proper marketing terminology. Pricing strategies can be simplistically referred to as ?above-the-market (higher than competition); at-the-market (same as competition); or below-the-market (lower than competition). You also can use terms such as "skim pricing", "penetration pricing" or other terms you will learned in this module.
20) Analyze the pricing strategies and tactics followed by your organization. Be as specific as possible and be sure to draw on Module 5 background materials in describing the integration of the marketing mix. (This is the same question as you answered for product, distribution, and promotion; but for pricing).
21) Briefly, explain if your organization has competitive advantages relative to pricing.
Please remember: All SLP discussions about competitive advantage must be specific; that is, directed toward each competitor. A simplistic example is that Burger King may have competitive advantage over KFC in terms of advertising, but it does not have competitive advantage over McDonalds. Of course, you would elaborate more and explain why your organization does or does not have competitive advantage in promotion relative to each particular competitor.
Wal-Mart Pricing Strategy
In present marketers develop different strategies to survive in the market and attack on the competitors. Among the various strategies of marketers one of the prominent strategies is pricing strategy. The effective and efficient pricing strategy plays a significant role in the accomplishment of organizational goals. The pricing strategy used by Wal-Mart is "below-the-market" strategy. The company has been using this strategy for setting the prices of its products for the last some decades and it has got success in capturing the large market of share.
In terms of revenue, Wal-Mart has become one of the largest revenue generated companies only due to its pricing strategy. The opening prices of the products of Wal-Mart are unbeatable and highly attractive, such as the price of a microwave oven is $14.67. The prices at Wal-Mart are set by keeping in mind the psychological state of mind of the customers. These types of price create an impact on the mind of customers that the prices of all the products of Wal-Mart are low (Studies reveal dual pricing strategies - comparison of Wal-Mart Stores Inc. prices with other discount stores in six U.S. cities - Wal-Mart, 2008).
While with the different offers of the Wal-Mart products one can confer that the pricing strategy adopted by Wal-Mart is "below the market" but in reality it is not like that as Wal-Mart does not offer lowest price to its customers on each and every product of its product line but it has been successful in creating and establishing a lowest pricing positing in the mind of the customers. The focus of the company on the low price strategy has become one of the strongest tools to cope up with the cut-throat competition.
EFFECTS OF PRICES ON THE DEMAND OF WAL-MART
Price is one of the important factors, which affects the demand of a product or a company. Generally, the demand of a product increases when its price falls. In the same way, when the ...
This solution helps go through pricing strategies within the context of the 4P's of the marketing mix.