Pricing Essay Example | Topics and Well Written Essays - 2000 words

set - Essay ExampleTherefore it is an exchange ratio between equitables and services.Pricing is important in market as it determines how a fruit or service will be accepted in the market. It is peerless of the most valuable four variables that be employ in the marketing mix which argon used to develop a business plan. This means that it is central to the operation of a profit oriented firm. (McNamara 2007, P. 61)As we have seen, pricing is one of the four factors that be used in the marketing mix of a firm and which is central to the development of a viable business plan. In this regard, pricing is important locution in market which has been as central to marketing. This is because the main(prenominal) aim of marketing is to take the crosswayion to as many guests as it can at the most affordable price that they can afford. Therefore the main aim of marketing as defined is to sell as many products as possible.There are many considerations that have to be made in marketing. In order to reach the target customer there are number of consideration that has to be made and the cost of the products as they are macrocosm taken to the consumers is one of those important factors that have to be considered. While pricing a product it is profitable for any marketing strategy to take into account the cost structure and the willingness of the customers to pay for the product and too look to the effect of the competing from firms which are selling the same products in the same market. Therefore a good marketing strategy is not the one that blankly targets the demand market but it is the one the targets the consumer and withal consider the effect of other competitors in the market. In this regard the competitor and the willingness of the buyers to buy a product at a particular price will have an effect on the overall force of the firm to sell its products. The firm must also consider the effect of demand dynamics. There are many sources of the demand dynamics. One of the factor that affect demand dynamics is the dependence effects. This is particular to the chinchy goods which are frequently purchased by the consumers like the household goods. For example if we take an example of Coke and Pepsi drinks, the prospect that a consumers will purchase any of the product will depend on many factors which are base on preference and loyalty which affects the demand of the product. One consumer may decide buy Pepsi based on the father one had on the product the last time it was purchased. On the other consider one may decide to by Coke as a matter of wanting to experience the difference between the two products. This would be in spirit of wanting to try something contrary from the other. In this case the consumer will be responding toe what can be referred to as market activities which are determined by demand dynamics. (Michael 2006, P. 34)This shows that there are many market activities that are likely to affect the way of life a company is going to set it price in the market. The choice of brand of a product in the market is likely to be one of the ways in which a firm is likely to set price. For example in the above given example coke and Pepsi may be glide path from the company but in real sense they may be retailing at different prices. While both of them are soft drinks, the demand dynamic