Business

Topics: Cost, Competition, Marketing Pages: 3 (1054 words) Published: September 8, 2013
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Pricing Concepts Assignments AnswersBelow are listed the answers to the assignments available within the student view:1. Why is merchandise so important to a Premier League soccer club? Why do clubs go into retailing and mail-order when their core business is football?Answer: It is important because: * it generates extra revenue over and above gate receipts, television rights, etc. * there are particularly high margins to be earned easily * fans are willing to buy and to pay premium prices for something tangible connected with the club * buying from the club's own retail outlet, catalogue or e-tail store reinforces the connection * it helps to reinforce fan loyalty * it involves fans who cannot afford to go to matches or who live too far away * clubs spend a lot of money establishing their brand names and it is a natural marketing decision (as with any other big name brand) to want to extend it beyond the core product and capitalise on its investment and success.Clubs have gone into retailing and mail-order because: * There is a serious market for their merchandise so why shouldn't the clubs get directly involved rather than letting other intermediaries have it all? * Premiership clubs have strong brand names in their own right and a retail/mail-order operation is entirely consistent with their core business as the merchandise forms part of the brand, allowing the fans to feel they are sharing a little piece of the club's success. It all helps to extends the total brand experience from the pitch to the home. * Clubs can source and stock a much wider range of club-specific merchandise in their own outlets than a more general intermediary could/would.2. What do you think are the internal factors influencing a club like Manchester United's pricing decision for replica kit?Answer: Internal factors: * Organisational and marketing objectives: the need to * meet and defend specified sales volume and market share targets * achieve...
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