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Why

Product Marketing Strategy helps manufacturers with product marketing, product strategy, and marketing strategy to maximize profitability over the product life cycle.

Pricing Strategy

Pricing Strategy in Burton, OHOf all the elements of the marketing mix, none is more visible to the consumer than the pricing strategy. Over time, no other element of the 4Ps is more considered by the consumer. Consequently, the pricing strategy is a key element in of the product offering.

One pricing strategy is to utilize a skimming strategy where the product is priced significantly above the competition. This is done to generate higher profits. Some do this because they only want the very  top of the market like Rolls Royce, Tiffany’s or Four Seasons hotels. The product or service must separate itself from the competition to justify the premium in the consumer’s mind.

Another option is use a penetration or commoditization strategy where the product is priced below the competition to drive volume.

Revenues must constantly be reinvested to establish and maintain a low cost producer status. Products usually are basic in nature and leave upgraded versions to the competition.

Many choose a market price strategy that is within 15% of the competition and work to gain market share with their unique selling proposition. This is the area of highest competition and highest volume until the next innovation comes along.

These are just a couple of different pricing strategies. While it is possible to change pricing strategies, most stay the same over the product life cycle. It is also important to consider your promotion strategy at the same time you are deciding upon your pricing strategy as you may be limited if you consider them separately.

Give us a call if you would like to further explore your options in pricing and promotion.

 

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    head-and-sholders  Robert Cannon

       With over 30 years of expertise in marketing, and leadership, Bob creates innovative systems, 
       products and services for small to mid-size manufacturers. Contact Bob today for more information 
       on the Cannon Advantage services and solutions.