Principles of Marketing Quiz 2
ALDI's has implemented a unique pricing strategy. What do they do in designing their stores?
Along with pricing their groceries up to 50% lower than competition, ALDI operates smaller and provides a smaller selection of store items. (about 1/4 the size of traditional supermarkets) and stocks only about 1,400 of the fastest-moving grocery items (other supermarkets carry about 40,000 items.)
How does APPLE use a "premium price" strategy to highlight their value?
Apple sells the "life-feels-good" experience to their customers. So even though Apple users are paying up to double the amount of other technology companies, they truly believe that the value received from the product well exceeds the price of it.
Why is "Commercialization" key in successful new Product introduction?
Commercialization - Introducing the new product into the market. Despite the intense costs of commercializing a new product, it is vital to advertise, have sales promotions and use other marketing efforts before competitors do. Take advantage of the timing when commercializing.
How does one practice Cost-Based Pricing and what is the advantage and disadvantage of this method? What is Cost-Plus method of pricing? (pg. 281, 282)
Cost-based pricing is often product driven. Involves setting prices based on the costs of producing, distributing, and selling the product plus a fair rate of return for the company's effort and risk. An advantage is these companies who offer lower rates can set lower prices that result in smaller margins but greater sales and profits. A disadvantage is they don't do premium pricing so they won't be able to benefit from high-demand and high prices. Cost-plus pricing is adding a standard markup to the cost of the product.
As with the case of Samsung, many companies develop an IOT strategy? What is IOT and what effect will it have on the economy?
IOT - The Internet Of Things, or Samsung says the "Intelligence Of Things." - a global environment where everything is digitally connected to everything else. The idea is that as customers become more connected with their devices, they can also become more connected to the brand.
What are the many definitions of a "New Product" and why must a branding and marketing program be developed for each?
Original products, product improvements, product modifications, and new brands that the firm develops through tits won product development. New products are important to both customers and the marketers who serve them: They bring new solutions and variety to customers' lives, and they are a key sources of growth for companies. Companies must be strategic with how they develop new products as sometimes the costs of product development are higher than expected, and sometimes competitors fight back harder than expected.
Price is one of the biggest headaches for Executive management but also the biggest opportunity to improve profitability. Why do executives not want to deal with it?
Pricing is the #1 problem facing many marketing executives, and many companies do not handle pricing well. Pricing is the only element in the marketing mix that produces revenue, all the other elements represent costs; therefore, it requires the most strategy.
What is Walmart's strategy to beat their rivals, especially Amazon?c
Rollback prices, "everyday low prices" is everywhere, has slow music to keep shoppers in store
Customer "value-based pricing" is best determined in what whom and how?
The company first assess customer needs and value perceptions, It then sets its target price based on customer perceptions of value. The targeted value and price drive decisions about what costs can be incurred and the resulting product design. As a result, pricing begins with analyzing consumer needs and value perceptions, and the price is set to match perceived value.
