Question

Questions from Wheelen, T., Hunger, J. Hoffman, A., & Bamford, C. (2018). Strategic Management and Business Policy: Globalization, Innovation, and Sustainability, 15th ed.  Pearson.

Chapter 8

What are the reasons for strategic planners to pay more attention to the importance of planning and implementing an effective pricing strategy in a competitive market?

Answer 1

PAGE.NO :- 01 Pricing Strategy: A business can use a variety of pricing strategies when selling a product or service the price can be set to moximise profitibility for each unit sold or form the market over all. It can be used to defend an existing market from new entrants, to increase market Share within a market or to enter a new market. Businesses moy benefit from lowering or raising prices, depending on the needs and behaviors of customers and clients in the particular market. Pinding the right pricing strategy is an important element in running a successful business. = From the above paragraph it is very clear that pricing is very important so it should be opplied with a proper pricing planning specially in nighly competitive market. ' following are the objectives of pricing strategies :- in Maximum current profit :- This objective is aimed at making as much money as possible. w Target return on Investment - Company sets its pricing policies and strategies in a way that sales revenue ultimately yields average return on total investment. (iii) Sales growth a- Pricing decisions are taken in way that sales volume con be raised. Setting price, altering in price and modifying pricing policies are targeted to improve soles. i

PAGE:No:-02 En To face competition in Compony sets and modifies its prilling policies so as to' respond the competitors strongly W to keep competitors away - low as possible to minimize Products. A compony keeps its price as attractiveness Ni To achieve Quality leadership by pricing : ? create a positive image that compony's product is standard or superior to the one offered by competitors. To win confidence of customers in Compony sets and proctices its pricing policies to win the confidence of the target (wins market. (viii To satisfy Customers :- Company sets, adjusts, and readjusts catistu its taged customers Pits pricing in short a company. should design pricing in such a way that results into maximum customers suctis loction Thanks SHAH FAIZAN AHNYAD.