PRICING-MEANING

Pricing is the art of translating the qualitative offerings into quantitative terms. Pricing begins with an understanding of the target markets, organizational objectives and marketing objectives. Pricing is equivalent to the total service offering. This include brand name, package, delivery , other benefits and so on.

OBJECTIVES OF PRICING

Financial

objectives Patronage objectives Volume objectives

FINANCIAL OBJECTIVES
Profit maximization Resource mobilization Price and profit stabilization Cash flow management Pre-determined profit level

PATRONAGE OBJECTIVE
To instill confidence To instill in the customers by price stability. This ll help the customer to budget confidently Inducement to try Enhancing image by giving some special offers so that customers try. This is also called price - skimming.

To desensitise To desensitise the customer to the price. E.g. package deals i.e., price inclusive of all breakfast, lunch and dinner, etc or inclusive of air fare. To differentiate one product from another To emphasis on an added service provided, thus, changing the customer perception towards that product through pricing

Volume objective

Market Share Service provider less the prices an input to enjoy a target market share. Market share is an indicator of customer and trade acceptance. Customer Base To build business by increasing the customer base as occurred in airlines with this strategy, prices are usually lowered to attract customers and to make them permanent customers.

New market at the beginning of a life a service, pricing is used mainly to enter into the market. Social Consideration pricing decision is influenced by social consideration like low price for education, public sports clubs etc.

FACTORS AFFECTING PRICING DECISION

ININTERNAL FACTORS

EXTERNAL FACTORSTER

INTERNAL FACTORS

Organizational policies Pricing generally take place at two levels: top level and lower level Service Cost it is necessary to assure that the price charged for a service covers the fixed, variable, and semi- variable cost incurred in providing that service.

Marketing Mix The four important Ps which constitute the marketing mix considerably effect the base price of a service or product Service Differentiation the service provider has to price the service to differentiate the service provided by his firm from that of the others.

EXTERNAL FACTORS
Demand Competition Government Controls

MARKET COMMUNICATION

The market communication contributes a substantial part of the marketing function. Traditional marketing function includes market communication activities such as sales, advertising and sales promotion.

MARKETING COMMUNICATION MIX

Adverising Personal

selling Direct marketing Publicity Sales Promotion

ADVERTISING Any form of non-personal about a professional service firm and its service offerings that is sponsored by the firm or on the firms behalf.

PERSONAL SELLING Personal communication with existing or prospective clients for the purpose of generating fees.

DIRECT MARKETING Directly reaching a market (customers and potential customers) on a personal calls, basis, or mass-media basis (infomercials, magazine ads, etc.)

PUBLICITY Non personal communication regarding a firm or its services

SALES PROMOTION Sales promotion is any initiative undertaken by an organisation to promote an increase in sales, usage or trial of a product or service