Unit 4 DB

Running head : Marketing Mix : Pricing Abstract

Numerous factors influence pricing decision , these factors are well thought-out to be very critical elements in developing marketing strategies . Since price is the building block that determines whether a product will or will not produce revenue , marketing executives need to make use of the information gathering skills and market research when implementing pricing decisions . Several factors influence setting of prices and demand , customer perception and cost of producing the product are just to name a few

Factors Affecting Pricing

There are several factors

that affect price setting in any given industry . Some of the factors that affect the pricing decision are demand , customer perception of product value , cost of producing the product . The market demand for any given product can adversely affect the final price offering . In most instances , the higher the demand the higher the price , however , a product price can be one that is too high to produce any demand and one that is too low to produce a profit (Armstrong Kotler , 2009 ,

.259

Different customers perceive the value of a product differently . How one perceives the value will determine the price they would be willing to purchase a product for . When setting the price of a product one ought to consider how the target customers perceive its value . Besides demand and product value , the cost of producing a product will determine the base market price for that product . This in essence will ensure that the product does not sell at...