Starting a price to a new product is not always very easy for brand managers, CEOs and sales executive. It is a real business in a sense that pricing strategy is a hard nut to crack. it has few basic principles which helps us to set a target price.
We consider that there are four basic components to a successful pricing strategy:
- Costs. Focus on your current and future, not historical, costs to determine the cost basis for your pricing strategy .
- Price Sensitivity. The price sensitivities of buyers shift based on a number of factors and your pricing strategy must shift with them.
- Competition. Pay attention to them, but don't copy them . . . when it comes to pricing strategy they may have no idea what they're doing.
- Product Lifecycle. How you price, and what value you provide for that price, will change as you move through the product lifecycle.
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