Sales Plan
MARKET RESEARCH 3
3.3
THE SALES PLAN
. Prices And The Market . Pricing Strategies . Marketing Segmentation And The Marketing Mix . The Marketing Process . Sales And Finance In Marketing . The Sales Plan Exercise - Calculating Financial Impact Of Sales
P 123
THE SALES PLAN 3.3
PRICES AND THE MARKET
There are a number of different approaches to pricing. Most businesses use a mix of these approaches or use a different approach to different customers and at different times.
How Your Product Or Service Compares
The price of your products and services will, to a certain extent, depend on the competition. Make comparisons based on the following where appropriate: . How your product performs . How it looks . What is its quality? . How is it packaged and presented? . Whether your level of service is better or worse than your competitors . Your image Do not be afraid of setting a higher price than your competitors if your product or service has advantages over theirs. Customers often associate higher prices with higher quality - therefore it may be that a higher price can help the image or reputation of your products and services.
Pricing Strategies For New Products
If you are offering a new product there are two approaches you could adopt: . Price Skimming - opts for a high price initially to take advantage of demand for a new product . Penetration Pricing - attempts to gain a large share of the market for your product before the competition appears on the scene, by setting a fairly low price to dominate the market
P 124
THE SALES PLAN 3.3
What The Market Will Bear
Some argue that the price should be set by what the market would bear, but there are no easy methods for calculating this. If your prices were high would your customer choose another supplier? If you dropped your prices would you gain new customers? Generally if your products are bought infrequently they are more likely to be less sensitive to price change. Alternatively, if your products are bought on
3.3
THE SALES PLAN
. Prices And The Market . Pricing Strategies . Marketing Segmentation And The Marketing Mix . The Marketing Process . Sales And Finance In Marketing . The Sales Plan Exercise - Calculating Financial Impact Of Sales
P 123
THE SALES PLAN 3.3
PRICES AND THE MARKET
There are a number of different approaches to pricing. Most businesses use a mix of these approaches or use a different approach to different customers and at different times.
How Your Product Or Service Compares
The price of your products and services will, to a certain extent, depend on the competition. Make comparisons based on the following where appropriate: . How your product performs . How it looks . What is its quality? . How is it packaged and presented? . Whether your level of service is better or worse than your competitors . Your image Do not be afraid of setting a higher price than your competitors if your product or service has advantages over theirs. Customers often associate higher prices with higher quality - therefore it may be that a higher price can help the image or reputation of your products and services.
Pricing Strategies For New Products
If you are offering a new product there are two approaches you could adopt: . Price Skimming - opts for a high price initially to take advantage of demand for a new product . Penetration Pricing - attempts to gain a large share of the market for your product before the competition appears on the scene, by setting a fairly low price to dominate the market
P 124
THE SALES PLAN 3.3
What The Market Will Bear
Some argue that the price should be set by what the market would bear, but there are no easy methods for calculating this. If your prices were high would your customer choose another supplier? If you dropped your prices would you gain new customers? Generally if your products are bought infrequently they are more likely to be less sensitive to price change. Alternatively, if your products are bought on