The development of enterprise pricing policy is a complex and important matter. If the company is a start-up, the products it offers are only appearing on the market, you first need to think about what niche it would like to occupy, and what percentage of the potential audience to capture, and then, accordingly, choose a pricing strategy. Having reached a certain level, the company expands, plans to increase its share of presence, or altogether changes the assortment and target group, and therefore somewhat changes the cost policy of its products.
The specialized literature presents an excellent classification of pricing types and the strategies used. And almost every section devoted to this ends with the idea that complex management is required from the enterprise management. This means that elements of several options should be present in different proportions in their personal pricing strategy. After all, market leadership can only be achieved with a flexible approach to prices and to your customers. Moreover, this axiom is applicable to any industry. The main thing is not to harm and find the very methods of winning a client. It is very important not to remain without profit.
How do marketers offer to calculate the price of a product? And what are the main pricing strategies?
The most difficult stage for a product is the initial one, when it only conquers the market. In this case, the price will become the determining factor for many buyers. And we will talk about this particular period.
The company can immediately set the minimum allowable value on its goods, and the profit from its sale will also be minimal. Such a strategy of “breakthrough” is only suitable if the company is ready to offer the market a large volume of its products and saturate demand in a short time.
Entrepreneurs sometimes set a low price for a product not only to penetrate the market, but also in order to eliminate competition or achieve the highest possible sales volume before a similar product offered by a competitor appears. The benefit here, of course, is not in the profit received from each realized unit, but in the sales volumes themselves . The effectiveness of this pricing strategy for small and medium-sized companies will be maximum if they are able to concentrate production on a small market segment. Here, as they say, came - saw - captured, and then left.
You can sell a product at a deliberately inflated value using a strategy called “skimming”. In this case, the product is focused exclusively on the audience, ready to buy new products, and the price tells them about a certain advantage, uniqueness over the others. This policy is suitable for industries such as pharmaceuticals, which incur large expenses for the production (research, development) of new products. But this pricing strategy also has a drawback - it is impossible to use it for a long time. So, travel companies at a new product at first hold rather high prices, and when demand begins to fall sharply, they are forced to lower them in order to win customers already with lower purchasing power.
The leaders of some enterprises in the same service sector, for example (restaurants, night clubs), use the strategy of so-called prestigious prices, which is equivalent to the desire to position their services (goods) in the VIP category. In this case, the high price associated with exclusivity, a certain prestige and status is a signal for wealthy clients, on whom the company relies. When using a different pricing strategy, the target group would most likely simply ignore this product (service).
The above strategies are convenient not only at the stage of entry into the market. However, for further product promotion, they must be supplemented with other elements, for example, a discount system, discriminatory or psychological pricing.