AMITY BUSINESS SCHOOL

Retail Pricing

By
Kamna Garg (1)

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 Developing Pricing AMITY BUSINESS SCHOOL

Strategies
Price :
 is only element in marketing mix produces
revenues, all other elements represent cost
 determines the amount of income generated
from sales of product
 differentiate product from competitors
 If too much generate fewer sales
 If too little sacrifice profits
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 Factors Affecting
AMITY BUSINESS SCHOOL

Pricing Decisions

Pricing determined by:

 Merchandise
 Location
 Promotion
 Credit
 Customer service
 Store image
 Legal constraints
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External Influences AMITY BUSINESS SCHOOL

on Pricing Strategy

Competitors

Government
Suppliers

Pricing
Strategy

Customers

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 AMITY BUSINESS SCHOOL

• Customer
Retailer has to understand price sensitivity (major
challenge)of customers that form his target
segment.
 AMITY BUSINESS SCHOOL

• Customer Segments on the basis of price

sensitivity
1. Economic
2. Convenience Oriented
3. Image oriented
4. Variety Oriented
5. Loyality Oriented
 AMITY BUSINESS SCHOOL

• Suppliers
Both the retailer and the Supplier
(manufacturer) like to have control and
want to price the product or services
according to their own image,goals,and
objectives.
 AMITY BUSINESS SCHOOL

• Competitors
In most cases,competitors are the most
influential factor in determining the prices.
The competitive environment affects the
freedom of a retailer to fix prices to a great
extent.
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• Government
Legal issues affecting the retail environment can be
broadly divided into two factors:
 Which affects the buying of merchandise
 Price Discrimination
Vertical price fixing
 Which affects the customer
Horizontal price fixing
 Predatory pricing
 Price & Marketing AMITY BUSINESS SCHOOL

objectives
Match price to objectives in strategic marketing
 increase market share
 increase sales
 improve profits
 project a particular image
 combat competition
 Slashed prices
 boost sales & fend-off lower-priced rival brands
 Premium pricing with other marketing mix give luxury position

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 Pricing Approaches AMITY BUSINESS SCHOOL

• Discount orientation
- Profit margins are kept low to
target price based customers.
• At-the-market orientation
- Margins are average to good
• Upscale orientation
- High price
 Pricing Methods AMITY BUSINESS SCHOOL

Every Day Low Pricing

High-Low Pricing
Loss leader Pricing
Skimming Pricing
Penetration Pricing
Price Lining
Psychological Pricing
Prestige Pricing

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 AMITY BUSINESS SCHOOL

Reference Pricing
Traditional Pricing
Odd-even Pricing
Multiple unit Pricing
Bundled Pricing
Demand Oriented Pricing
Fixed and Variable Pricing
Setting retail Prices
AMITY BUSINESS SCHOOL

• Mark Up
• Mark Down
 AMITY BUSINESS SCHOOL

Thank You

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