Pricing Strategy

Pricing Strategy

In economics and business, the price is the assigned numerical monetary value of a good,service or asset .Price is also central to marketing where it is one of the four variables (4 P'snamely Product, Price, promotion, Place) in the marketing mix that business people use todevelop a marketing plan.Pricing is a big part of the marketing mix. Choosing the right price and the right pricing strategyis crucial to the marketing process. The price of the product is not something that is fixed .Onthe other hand the price of the product depends on many other factors .Sometimes the

price of the product has got nothing to do with the actual product itself .The price may act as a way toattract target customers. The price of the product is decided keeping many things in mind.These things include factors like cost incurred on the product, target market, competitors,consumer buying capacity etc.

Coke - Price

Coke was a company ruling the markets before Pepsi entered. Earlier the price of coke wascost based i.e. it was decided on the cost which was spent on making the product plus the profitand other expenses. But after the emergence of other companies especially the likes of Pepsi,Coca-cola started with a pricing strategy based on the basis of competition .Nowadays moreexpenses are spent on advertising by soft -drink companies rather than on manufacturing .Cokehas brought in a revolution especially in Indian markets with the Rs.5 pricing strategy which wasvery famous. It was the first company to introduce the small bottle of Coke for just Re.5 .This campaign was very successful especially with the price conscious Indian consumers. Eventoday most prices of Coke are decided on the basis of the competition in the market

Pepsi - Price

Pepsi again decides its price on the basis of competition .The best think about the companyPepsi is that it is very flexible and it can come down with the price very quickly. The company isrenowned to bring the price down even up to half if needed. But this risk taking attitude has alsoearned Pepsi losses. Though lowering the price would attract the customers but it would nothelp them cover up the cost incurred in production hence causing them losses. This was thesituation earlier but now Pepsi is a full-fledged and growing company. It has covered all itslosses and is now growing