Pricing Objectives
Pricing decisions will form a key part of the firm’s overall marketing strategy. In this activity, the task is to identify why the firm has adopted their particular pricing approach.
price
Price Calculation: Cost-plus Pricing
The task for this activity is to work through the two examples for cost-plus pricing for students to gain a better understanding of this method.
Price Calculation: Breakeven Pricing
Work through two examples of using break-even analysis for pricing, to gain a better understanding of this approach.
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Price Calculation: Target Profit Pricing
Students use target profit pricing to determine how many units we will need to sell to both cover costs AND achieve a set profit.
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Price Calculations: Marginal Analysis
Students set prices using marginal analysis. This pricing approach looks for the maximum profit point, considering the firm’s cost structure and the likely sales at different price points.
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What Price Mark-up is Needed?
In this activity, the student task is to determine what average prices will need to be charged by these small retailers so they end up making a good profit.
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Price Penetration or Price Skimming?
This activity follows the discussion in a manager’s meeting for a firm that produces entertainment/game consoles and they are trying to decide whether to use a price penetration or price skimming strategy in the upcoming launch of their game console.
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Setting Your Price
Students assume that they decide to start a business as a marketing consultant. How much do they need to charge for their consulting services?
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Value Pricing – A Tough Decision
This activity requires students to determine a price solely based on what value the product generates for the customer. As there are only insignificant variable costs involved, what price is right?
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Competitive Pricing Responses
Students need to identify what would be the most appropriate pricing reaction for various market situations and competitive actions.
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