Pricing Strategy

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Pricing Strategy and Channel Distribution

Pricing Strategy and Channel Distribution

Determine and discuss a pricing strategy (Penetration or Skimming).

The pricing strategy for Crystal Light Kicks will eventually be in line with current pricing of other Crystal Light products as the Crystal Light brand is already in existence. Current Crystal Light pricing is at a suggested retail price of $2.56 oz for a 1.4 oz package ($3.54) that includes 10 on the go packets and $1.25 oz for a 3.2 oz canister which can make a 12 quart pitcher ($4.00) according to Pea Pod by Giant supermarket ( The initial pricing strategy for Crystal Light Kicks will take a penetration pricing strategy to introduce the product to assist in dispersing the brand quickly and widely throughout the new market segment. Since the target market is children ages 5-16, the strategy is to employ parents who drink the existing Crystal Light product to purchase the product for their children. Crystal Light Kicks will offer its new product at a suggested retail price of $2.31 oz for the same size package as the regular 10 count on the go packets ($3.23). For the canisters, Crystal Light will take on a true penetration pricing strategy by offering the 10 oz canister for $.50 oz and will be sold at the same supermarkets offering the existing product line. Kraft Brands and Crystal Light will take the penetration approach to help capture a large segment of their target market (children ages 5-16). Since the product line will include round shaped canisters with a scooper to stay in line with other products marketed to children like Kool-Aid it will be important to remain competitive with their pricing. According to Pea Pod by Giant supermarket, Kook Aid 19 oz cans are priced at $0.18 an oz coming out to $3.42. Kool Aid may offer a larger size canister but Crystal Light requires less scoopes to make a pitcher. Skimming is not an option for the new Crystal Light Kicks brand as...
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