this ppt is telling about pricing strategy for rural market.

1. Guided By: Presented By:
Prof.Mukesh Ranga Archana Sharma
Shikha Gupta
M.B.A.(B.E.) 3rd sem I.B.M.
Batch (2011-2013)

2. Pricing

 Price is a major element of the marketing mix.it is an
important strategic issue because it is related to
product positioning.
 Pricing is a determinant of the market demand for
the product. But before any pricing decisions are
undertaken ,it is important that the factors
influencing price are understood. These factors can
be categorized as internal and external

3. Influencing factors
 as internal and
These factors can be categorized
external factors
Internal factors : The internal factors affecting price
include cost and the company’s pricing objectives.
 cost factors
 Promotion as a cost factor
 Credit based transactions increase costs
 Pricing Objectives
 Profit maximization in the long run
 Minimum returns on sales turn over
 Deeper penetration of the market

4. 
 Keeping up with the competition
 Increasing sales volume and market share
External factor: This factor includes –
 Customers
 Suppliers
 Competitors
 Legal environment

5. Pricing strategies

 Optional product pricing
 Captive product pricing
 Product bundle pricing
 Penetration pricing
 Economy pricing
 Value pricing
 Coinage pricing
 Psychological pricing

6. 
 Discounts and allowances:
 Cash discounts or bargaining benefits
 Free gift
 Schemes for retailers
 Discriminatory pricing:
• Customer segment pricing
• Product form pricing
• Location pricing

7. Optional product pricing

Optional product pricing is the pricing of optional or
accessory products along with the main product like a
company selling tractors for a low sticker price but
charging high prices for serving and spare parts.
Ex:

8. Captive product pricing

Captive product pricing is setting a price for products
that must be used along with the main product , such as
blade for a razor and film for a camera.
Ex:

9. Product bundle pricing

Product bundle pricing is combining several products
and offering the bundle at a reduced price .
Companies very commonly use this pricing strategy
during periods of inflation it helps to generate sales and
attract customers in a highly competitive market , it is
mostly used in festival.

10. Penetration pricing

A penetration pricing policy involves setting prices of
products relatively low compared to those of similar
products. This pricing policy is appropriate when
demand is elastic.
Ex: Anchor white and Ajanta tooth pastes used this
pricing to enter the crowded dental cream market

11. Economy pricing

Economy pricing is no-frills low price, the cost of
marketing and manufacturing are kept to a minimum.
Regional and local manufacturers usually follow this
economy pricing strategy as they have limited
investments to make on building brands and
developing channels.
Ex: Nirma & Ghari

12. Value pricing

When economic recession or increased competition
forces a company to provide value products and
services to retain sales.
Ex: Godrej No.1 soap placed their offering containing
rose, sandalwood neem and other ingredients at a very
economical price .

13. Coinage pricing

Prices are set of a coin value. Coinage price is directly
proportionate to the package size. These packs are
small in size and are normally meant for one time
consumption(shampoo sachet)or days consumption(tea
bag)or a week’s consumption(bathing or washing
soap).

14. Psychological pricing

The price quality relationship refers to the idea that
consumers tend to equate product quality with the
price charged.
In the color TV segment LG at a higher price is
considered a better buy than Texla and Jolly brands
particularly in R1 households.

15. Discounts and allowances

 Cash discounts or bargaining benefits
 Free gift
 Schemes for retailers
 Discriminatory pricing

16. Discriminatory pricing

Price discrimination exists when sales of identical
goods or services are transacted at different prices from
the same supplier, different prices are charged on the
basis of different consumer groups, location, product
form etc. discriminatory pricing may take the following
norms-
 Consumer segment pricing
 Product form pricing
 Location pricing

17. Consumer segment pricing

Discriminatory pricing based on consumer segments.
Ex: Museum often charge low admission fee for
students and senior citizens.

18. Product form pricing

Different versions of the same product are priced
differently but not proportionately to the increase in
costs.
Ex: Microsoft sold different versions of its operating
software windowsXP at different price level . Windows
vista home basic version is sold at $200 and with some
variations the same operating software windows vista
ultimate version is sold at $320.

19. Location pricing

Discriminatory pricing based on different locations,
even though the cost of offerings at each location is
identical.
Ex: Theatre charges different prices for different
audience preferences for different locations.

20. 
THANK YOU