PRICING STRATEGIES AT HP AND KODAK
When marketing products, it is very unlikely that consumers will purchase every products created. The days of creating products and marketing to all consumers are over. Customers have wants and needs and they know where to go and find their wants and needs. The objective to a successful marketing campaign is to separate your product from the competition. Michael Porter developed a model to formulate strategy’s to gain competitive advantages over the competition. These strategies could be one of two methods 1) strategy based on differentiation where a firm seeks to be unique in its industry or market segment along particular dimensions that the customer value or 2) cost leadership strategy where a firm would focus on being the low-cost company in it industry. Currently in tough economic times, consumers are rushing to retail locations looking for the best priced products to satisfy their wants and needs. To help accomplish this goal it is important to use the “Cost Leadership Strategy”. For this strategy to be successful the organization must emphasize efficiency in production, product design, manufacturing, distribution, technology, and etc. With this said, an effective pricing strategy can help distinguish your product over the competitors. This paper will look into the current battle between Kodak and HP concerning the printer ink efficiency and price. The Kodak Company
Kodak recently designed a new printer that prints high-quality photos at a lower price than industry standards. With print supplies including (paper and ink), the current cost of printing photos is $.10 per print where HP has it at $.24 per print. Kodak will revolutionize the industry if they are accepted as the go to product by consumers. Consumers stated that they wanted to produce pictures for less and Kodak delivered. Kodak’s price strategy is a direct assault on companies that make the majority of their profit on print supplies....
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