Pricing Strategy and Distribution

=Channel distribution is the path that a product takes from the producer to the consumer and physical distribution is the actual movement of products that path.

Loyalty programs include frequent flier miles or points systems associated with credit card offers that can be used only with the original company, creating a perceived loss or cost when switching to a competitor. Most programs are able to get consumers to spend more money just to get to free or bonus item.

Distribution channels are organized in several ways: conventional, vertical, horizontal and multichannel (Kern R. 2013). Some of these organizational methods are more structured than others. When a distribution channel deals with more than one independent producer, such as wholesalers and retailers, the channel is known as a conventional distribution channel. (Kern R. 2013) These channels are not normally known to be strong and typically don’t give the customer the quality of product that they deserve. In a vertical marketing system, the retailers, wholesalers and producers, join forces to create a unified front, promoting an individual product (Kern R. 2013). Vertical distribution channels are stronger than the conventional distribution channels because all of the companies involved carry some of the load of power. (Kern R. 2013) In a horizontal distribution channel, companies join up and combine all of their finances and resources, in order to take on more than one company or product (Kern R. 2013). A multichannel distribution channel is where a large corporation uses two or more marketing channels to better target their desired customer segments (Kern R.

Some studies results show that the customers are willing to pay even more for Rose’s new brand than it was suggested to them. So the company has the possibility to increase the price by 6-7% at their new products in order to cover the expenses with advertising.

As mentioned in an earlier assignment, there are three main types of distribution channels. The first is the channel that goes from the producer, then to the wholesaler, then to the retailer or sells to the consumer. The second channel starts with the producer who sells straight to the retailer, who then sells to the consumer. The third channel goes directly from the producer to the consumer. Channels one and two are classed as indirect marketing channels, whereas channel three is a direct marketing channel as it goes straight from producer to consumer.

32. A channel of distribution is part of a broader network of relationships called a supply chain.

The Chemist Warehouse follows a mixer of various pricing policy which has made them the market leaders in pharmaceutical line. They have identified price level that enables them to maximize sales and profit. Our Nature’s Own product – B12 is an unsought product i.e., the consumers are not aware of the product or are not thinking to buy it. The price charged by them is lower than Priceline (competitor) (Refer to figure below). On their receipts as well they mention the amount of dollar a customer has saved which would not have been possible if they purchased it from another pharmacy. This strategy makes the customer visit the shop again. (Bainbridge, 2014). To make the product a sought product they follow aggressive discounting policy to make people purchase the

A marketing channel is simply a path that flows from sellers to end-users (customers). Traditional brink and mortar marketing channels can include intermediaries such as manufacturers’ agents, wholesalers,

According to Natureview’s employees, “Natureview’s all-natural ingredients would deliver the most ideal positioning from which to launch their own children’s multi-pack product, which would offer into their core sales channel” (p.8). According to exhibit 5, Natureview accounts for 24% of the yogurt sales in natural foods channels. Natureview is the leading product in sales for natural foods channels and if they were to expand to supermarkets, then the product would account for less than 5% of the sales initially. If Natureview were to expand to supermarket channels, then they would have to mark down their prices of yogurt to 15% lower than what they sell at the natural foods channels. There is a potential risk of long-term partners of Natureview and current customers may have a bad reaction to the Natureview expanding in supermarkets and marking down their yogurt prices. There would be the possibility of Natureview’s current natural foods channels dropping the brand and replacing it with competitor’s line due to the brand expanding to supermarkets and selling at lower prices. There is also a possibility that Natureview wouldn’t survive in the supermarket channel against competitors. Some of Natureview’s employees feel that Natureview’s brokers do not possess the resources or skills to adequately sell their products in

The North Face set relatively high range of price on their products. The industry is in mature stage of industry lifestyle and in this stage the market grow when the economic also grow. Currently the growth rate of the industry is slow down and it reaches market saturation (IBISWorld). Often customers try to reduce their spending when the economy become slowdown, therefore customers become price

Nature Care products recognizes the unique expectations from individual consumers and have developed its niche product lines, such as make up, perfume, body deodorant, nail polishing, lipsticks, hair dyes, etc. These products intend to solve customers’ skin problems with the quality to offer specific therapy and cosmetics solutions. With the demands of various consumers Nature Care products main marketing objective is to provide a product range in each niche to fit various customers ' needs.

The strategy for setting a product’s price often has to be changed when the product is part of a product mix. In this case, the firm looks for a set of prices that maximizes its profits on the total product mix. Pricing is difficult because the various products have related demand and costs and face different degrees of competition.

Based on these 6 factors in setting a price: selecting the pricing objective, determining demand, estimating costs, analyzing competitors costs, prices and offers, selecting a pricing method and selecting the final price, Singapore GP Pte Ltd employed 2 different pricing strategies. They are

Marketing channels are the arrangement of intermediaries (wholesales, retailers, and the like) that the firm uses to achieve its marketing objectives. Is the problem discussed in Handy Andy’s marketing channels? Why or why not? Utilizing the factory distributor

Keeping these realities in mind, it is very much obvious that for this market, we choose and follow a value based pricing and do not keep the price of the product too high. It is advisable rather to follow an average pricing and let the consumers build some enthusiasm around the product.