Tweeter Case
QUESTIONS: Should Tweeter continue with its Automatic Price
Protection (APP) policy along with Every-day Fair Pricing (EDFP)?
Tweeter should continue with its current Marketing strategy based on APP policy and Every-day Fair pricing. Their target customer is the Quality/Service oriented and they should focus on retaining their loyalty. The shift from having continuous Sales Events to fair pricing and price protection has been proven successful as same store sales have increased, new stores have delivered consistent sales and total marketing expense has not increased as a % of Sales. Also profitability of the company has gone back to positive numbers as a result of the new pricing strategy. By not entering the Sale events, Tweeter will be able to maintain its reputation of high-end quality service retailer and keep its current market segment very well satisfied with its price protection program.
1. Customer Analysis:
(a) What are the challenges that Tweeter faces in the market environment that they have to compete in? Use the data in Exhibit 13 to assess whether Tweeter is price competitive with its competitors when comparing objective prices? What factors impact the price image of retail store and how does Tweeter compare with its competitors?
As a retailer of consumer electronics Tweeter faces several challenges in order to keep growing its sales and capture new consumers into their stores. As a boutique or specialty retailer of electronics Tweeter faces direct competition from other distribution channels in which the same products are sold. These are Electronic/Appliance Superstores, Department stores and in less weight Mass merchants and Warehouse clubs. These bigger retailers characterize by giving consumers an image of everyday low prices which drive them into their stores, generally offering attractive Sales Event every week. Another challenge Tweeter faces is the entrance of new stores to the market with the chain Wiz planning to open 8 more stores
Protection (APP) policy along with Every-day Fair Pricing (EDFP)?
Tweeter should continue with its current Marketing strategy based on APP policy and Every-day Fair pricing. Their target customer is the Quality/Service oriented and they should focus on retaining their loyalty. The shift from having continuous Sales Events to fair pricing and price protection has been proven successful as same store sales have increased, new stores have delivered consistent sales and total marketing expense has not increased as a % of Sales. Also profitability of the company has gone back to positive numbers as a result of the new pricing strategy. By not entering the Sale events, Tweeter will be able to maintain its reputation of high-end quality service retailer and keep its current market segment very well satisfied with its price protection program.
1. Customer Analysis:
(a) What are the challenges that Tweeter faces in the market environment that they have to compete in? Use the data in Exhibit 13 to assess whether Tweeter is price competitive with its competitors when comparing objective prices? What factors impact the price image of retail store and how does Tweeter compare with its competitors?
As a retailer of consumer electronics Tweeter faces several challenges in order to keep growing its sales and capture new consumers into their stores. As a boutique or specialty retailer of electronics Tweeter faces direct competition from other distribution channels in which the same products are sold. These are Electronic/Appliance Superstores, Department stores and in less weight Mass merchants and Warehouse clubs. These bigger retailers characterize by giving consumers an image of everyday low prices which drive them into their stores, generally offering attractive Sales Event every week. Another challenge Tweeter faces is the entrance of new stores to the market with the chain Wiz planning to open 8 more stores