1- Which of the different product mix pricing strategies discussed in the text applies best to Payless’s new strategy? Discuss this in detail.
The strategy for setting a product’s price often has to be changed when the product is part of a product mix. Companies usually develop product lines rather than single product. Product mix means in the same companies have many type product with they are brands it sold. Product mix pricing strategies consist of five elements which is product line pricing, product bundle pricing, by-product pricing, captive product pricing and optional-product pricing.In this case, the product mix pricing strategy Payless use is product line pricing
. Product line pricing is setting the price steps between various products in the product line based on cost differences between the products,customer evaluations of different features and competitor’s prices.Payless have strategy product line, from one comprised almost entirely of store brands to one dominated by well-known national brands. Payless now sells shoes under numerous brand names that it either owns or licenses,including Airwalk, Champion, Spalding, Dexter, Shaquille O’Neal-endorsed Dunkman, and various Disney brands. Customer can buy many types of products with different prices by looking at size, width, color and design. For example, for boys’ shoes, they have many shapes, size, color, design, and numerous brands which they can get with difference price from $ 12.99 until$26.99. For girls, there are shoes in differences brand like Fioni, Amerian,Eagle, Dexter, Lela Rose, and Smart fit from $14.99 until $24.99. Most products Payless offers are under $50.Other than that, Payless have relationship with top New-York based designers Laura Poretzky, Lela Rose, Stacey Bendet and Patricia Field. The four are designing everything from pumps to boots to handbags for Payless.Payless sets most of the stores product line below $15. The company’s CEO,Matt Rubel also has suggested that in...
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