Bus 620 Week 4 Assignment

Pricing Strategies: Identity three types of pricing strategies. Select a good or service and compare the prices of two different companies associated with the goods or service. Why do different organizations have different pricing strategies for the same good or service? There are many variables that can determine price such as the production cost, competitor’s price, and price the customer is willing to pay for a product. Price can be simply defined as what a consumer’s pays for a product. A product's price is simply the payment given by a buyer to a seller in exchange for goods or services. Buyers seek to minimize the payment required to obtain goods as a basis for maximizing the value they receive. Sellers generally endeavor to secure higher prices to increase the revenue from each sale; pricing decisions are always critical to the firm's achieving its overall financial goals. Consequently, the process of setting prices must be based on a fundamental understanding of what the organization is trying to

The Role of Pricing Pricing Strategies: Identity three types of pricing strategies. Select a good or service and compare the prices of two different companies associated with the goods or service. Why do different organizations have different pricing strategies for the same good or service? Respond to at least two of your classmates posts. The three major price strategies defined with in the text are Cost – based pricing, Customer – based pricing, and Competition –based pricing. Cost - based pricing looks for the breakeven point or lowest price that it takes to cover both the variable and fixed cost associated with the production of a product. The amount over this price will be considered profit. Customer – based pricing strategy takes into account a customer; the buyer’s perception value that they would receive based on the price placed on either a product or service. Competition –based pricing strategy is used by companies in a way to consider price changes made by their competitors as a way to determine whether to increase or decrease their prices. According to Finch (2012) “Alternatively, they may set a price higher than their closest competitors' prices as a means of positioning their product as a premium brand” (para. 7). Select a good or service and compare the prices of two different companies associated with the goods or service. Dish Network and Direct T.V. are both satellite television content carriers. Dish Network has service packages that range from 19.99 to 89.99 as long as you sign a contract for 24 months. Direct T.V. charges 24.99 to 92.99 for similar content packages. I believe that Direct T.V. charges more for similar service because the company sees itself as the market leader and therefore their services should be considered premium. Direct TV also has a deal with the NFL network which is used as a marketing tool to draw in customers who enjoy watching football. Also they both

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