Pricing Strategy and Channel Distribution

Solution Preview

Pricing Strategy and Channel Distribution
Pricing Strategy and Channel Distribution

This activity is part of your marketing plan.

1. Determine and discuss a pricing strategy (Penetration or Skimming).
Marketing mix elements consists of 4Ps such as Price, product, promotion and placements. It entails the marketing plan of the organization/product. As per Mindtools, ""Marketing mix" is a general phrase used to describe the different kinds of choices organizations have to make in the whole process of bringing a product or service to market."
Hence Marketing mix helps in defining the positioning of the product and other marketing elements. As per tutor2u, Marketing mix consists of :
"Product - the product (or service) that the customer obtains
Price - how much the customer pays for the product
Place - how the product is distributed to the customer
Promotion - how the customer is found and persuaded to buy the product"
Pricing strategy is an important component of Marketing Mix.
Price is an important factor in order to attract customers towards the revolution of reversible garments, as we are targeting customers between 16-25, this product is going to be a head turn for everyone as it will be affordable for the society. But at the same time there will be Variety that Will Differentiate the price factor. This will not be to differentiate the class of the society but just to differentiate the product and class of the product. Since our brand has a unique identity and less number of competitors we have decided to set the pricing relatively high for the merchandise at first, then would lower the price over time which will lead to PRICE SKIMMING.
2. Determine and discuss pricing tactics (Product line pricing, Value pricing, Differential pricing, or Competing against private brands) to be used for your product.
We will follow competitive pricing. Competitive pricing means tackling the price leader in the market segment in which the company is operating. Where possible, the aim would be to set a slightly higher price than the price leader's (say 7 per cent) and then launch a marketing campaign to demonstrate that what Winkler calls a 'discernible product difference' exists. This means demonstrating that the company's product offers a distinct improvement over its competitor's.
If the firm cannot compete on quality it may have to set slightly lower prices or offer higher discounts of at least 10 per cent but not more than 15 per cent or so.
Our Brand will adopt competitive pricing strategy for pricing its products. The prices of the products of it are very similar to its competitor adidas. It is following adidas and will set its prices accordingly.
The firm may seek price stabilization to avoid price wars and maintain a moderate but stable level of profit. We will not indulge in any price wars with its competitors and will focus on maintaining stability in the market. It will follow its competitor adidas for setting the prices. The brand will keep a moderate mark up and will not overcharge from its customers.
PROMOTIONAL PRICING
SPECIAL EVENT PRICING: reducing prices in retail stores at certain times of the year (e.g. immediately after festive season) to attract customers.
As our Brand is preferred by the customers mostly during special occasions, special event pricing will be used. On festive occasions special discounts and schemes will be introduced in the stores to pull the crowd.

3. Identify any legal and ethical issues related to the pricing tactics.
The users of Reverse in style would be provided with the most innovative designs and cuts. We will be ethical in pricing and would give them good quality fabric, comfortable clothing. We will offer the patrons a designer look but without being hard on their pockets and will come up with new styles on a regular basis.

4. Prepare a marketing distribution channel analysis identifying the wholesaler, distributor, and retailer relationships.
Place is all about the kind of people that make if worth living, here we are focusing in major cities of US. The geographical unit for this brand would be major Urban cities of US. Exclusive stores will be opened in these cities only.

5. Discuss how the distribution strategy fits the product/service, target market, and overall marketing objectives for the company.
A buyer from Reverse in style would feel smart, different and connected to their believe. The customer today wants to wear what depicts their own personal style. The customer is experimental, knowledgeable and knows what he wants. They like to wear what shows what they are. Reverse in style will make them ...