Doc international marketing and pricing strategies yousaf. A pricing strategy takes into account segments, ability to pay, market conditions, competitor actions, trade margins and input costs, amongst others. From this selection, comparison can be made of their relative strengths and proper implementation. Learn how to apply a range of alternative international pricing strategies. Here are several things you should know before you get started using this pricing strategy. Detailed research into your target market will ensure that you are fully conversant with the average purchasing power within your target country and are up. International pricing and distribution strategies springerlink. Company and product market environmental c orp ate objective confirm impact of corporate strategies on pricing policy options evaluation selection of most appropriate pricing option i mpl e nt o use of t actics nd p roc edu s to set sbu prices price m an gement dealing with international pricing. International marketing pricing strategies tutorialspoint. Companies using this strategy are attempting to enter new or international markets by. Doc international marketing and pricing strategies. Part 4 developing international marketing strategies module 10 international marketing strategies 101. In response to certain important gaps identified in the global marketing literature, the focus of this inquiry is an investiga tion of the pricing strategies followed by.
Although interest in international marketing has been growing rapidly, little or no attention is given to a pricing strategy involving price discrimination under governmental import restrictions such as import quotas. Pricing strategies and customer retention the case. The study aims to expand the study of international entrepreneurship and global firms by including a broader and deeper range of pricing aspects. Pricing strategies and customer retention the case of airtel t ltd gibson gidion ndyamukama magdalena wenceslaus machibya bachelors thesis may 2015 degree programme in international business option of financial management. For example, when sony was developing the walkman in 1979, although a retail price of. Getting the right pricing strategy for your international forays will not happen overnight because there are many challenges to getting an equitable agreement on pricing in a global market. Pricing strategies determine the price companies set for their products. The pricing strategy used for a new product is affected by the product image desired, the amount of competition, and sales goals.
Majorly there are three methods of pricing determination strategy. Definition of dumping in international trade, the export by a country or company of a product at a price that is lower in the foreign market than the price charged in the domestic market. This international pricing strategy is just one of the many plans and strategies available for free from globig. Global pricing survey managing global pricing excellence deloitte. Competitive pricingif the new product has competition already on. Pricing strategy has played an important role in consumer purchasing behavior and decision making process richard, 1985. This chapter presents a methodical approach to strategic pricing analytics, based on best practices towards maximizing profit. Irrespective of the context, companies need to set their pricing strategy to recoup capital investment, make a. For international markets, pricing is one of the most important elements of marketing product mix, generates cash and determines a companys survival yaprak, 2001.
Assessment of target markets evaluation of price and its ability to purchase 3. Markup pricing, new product pricing, psychological pric ing, and. The purpose of this study is to identify various international pricing strategies and models used in real world companies. Analysis of demand, cost and profit relationships 5. When talking about the price of a product, it is important to notice that it is a sum of all monetary and nonmonetary assets the customer has to spend in order to obtain the benefits it provides. Pdf pricing strategy is the policy a firm adopts to determine what it will charge for its products and services. If you would like to learn more about globigs resources, join globigs resource hub for free. International journal of business marketing and management ijbmm volume 2 issue 4 april 2017, p. Feb 14, 2017 developing a pricing strategy for any market is a complicated taskthere are so many different factors that go into creating it.
One of the most commonly discussed strategies is the skimming strategy. Finally, the study shows that the value of marketing strategies and when products move through their life cycle process, different marketing management strategies are developed and applied as appropriate. A companys pricing strategy is a highly crossfunctional process that is based on inputs from finance, accounting, manufacturing, tax and legal issues kotabehelsen 2014, pp. Further, appropriate pricing aids proper growth, as development of a mass market depends to a large extent on price. The main pricing decisions in international marketing comprise the following. A multiplecase study vinod kumar chandola1, huifen fu2. To determine the most effective pricing strategy for a company, senior executives need to first identify the companys pricing position, pricing segment, pricing capability and their competitive pricing reaction strategy. For example, the cost of a 2liter container of coke in the united states is unique in relation to the cost of a similar item in china. It is targeted at the defined customers and against competitors. Pricing approaches major pricing approaches are cost based pricing and market based pricing. Penetration pricing can be used to achieve market share as a competitive strategy to achieve market leadership.
Factors to determine an international pricing strategy. Everyday low price edlp being great merchants strategy for store acquisitions 53% 32% 15% latam asia fy12 estimated new sq. Pdf international pricing strategies for bornglobal firms. Customer value price cost product product cost price value customer costbased pricing customer valuebased pricing. We are indebted to our colleagues in international business schools and. Mode of entry, product, positioning, pricing, and promotion. Factors influencing pricing strategy in international marketing. One of the main factors to determine an international pricing strategy is the. Factors that affect pricing strategies for international. Three commonly used methods for pricing new products are competitive pricing, skim pricing, and penetration pricing. Product life cycle and marketing management strategies. Pricing management and strategy for the maritime equipment manufacturers and service providers 14 december, 2017 3. Pricing decisions are complex in international marketing. Sometimes low price is the result of predatory pricing strategy.
This strategy can help optimize profits and compete more effectively. This paper examines factors that affect pricing decision for export markets, and sheds light on international pricing strategies in a global competitive market. Developing an international pricing strategy can be even more challenging. Factors influencing the degree of international pricing. This is why this paper starts by presenting basic pricing concepts. Present a marketing analytic to assess the profit impact and risk of an international marketing strategy. A business can use a variety of pricing strategies when selling a product or service. Factors affecting international pricing strategies 5. Market penetration strategy of smartphone companies from. Pricing strategy in international marketing springerlink. Other times, it can also be used to increase market and sales growth. Demonstrate international costbased pricing impact on consumer prices vs. International pricing objectives and strategies myers.
Pricing, an important decision in any business, be it domestic or international, directly affects revenue and thus profitability. Strategic pricing and detailing behavior in international markets. Price setting should be done on two levels in international marketing. This paper aims to understand how born global firms develop their international pricing strategies, practices, and models. A firm may have to follow different pricing strategies in different markets. Segmented pricing strategies a segmented pricing strategy x uses two or more different prices for a product, even though there is no difference in the items cost. Dec 15, 2010 nevertheless, pricing is largely neglected in international marketing literature, specifically in the field of b2b transactions, the topic of this article. International journal of business marketing and management ijbmm page 10 market penetration strategy of smartphone companies from china for india market. International pricing strategies for bornglobal firms central.
Technical material is updated with each new edition and this book is correct as at 15 september 2012. Price strategies, pricing adaptation, export performance, price adaptation. It can also be used to defend an existing market from new entrants, to increase market share within a market or to enter a new market. Chapter 18 global pricing and distribution strategies.
International pricing strategy is a key component of the international marketing mix. The authors present an overview of current international pricing literature and discuss the many different pricing decisions that international marketers face. By using the full strategic and operational potential of value pricing, benefits would show even more clearly than today. In the context of international business, a firms marketing mix may vary from country to country in order to accommodate local differences in culture, economic conditions, product standards, distribution channels, government regulations and so on. International marketing pricing strategies with respect to marketing mix, price is the least attractive element to be considered. Price is a major parameter that affects company revenue significantly. It still involves the many domestic pricing factors, but also includes unknowns, often making it an even more difficult task. According to clarke and wilson 2009, international pricing decisions also need to take account of tariffs, quotas, local taxes, subsidies, grants, currency exchange, rates, local purchasing power, local business and consumer characteristics. International pricing is often considered the most critical and complex issue in international marketing.
Multifactor asset pricing analysis of international value. The price can be set to maximize profitability for each unit sold or from the market overall. Of these, customer valuebased pricing is increasingly recognised in the literature as superior to all other pricing strategies ingenbleek et al. Factors influencing the degree of international pricing strategy. Discuss factors that must be considered in setting prices. In hard copy form, this 2014 edition is the latest development of a work begun.
Whatever might be the strategy followed, pricing has to reflect the proper value in the eyes of the consumer wherever they are situated. Differentiate prices according to the willingnesstopay in each market, and make considerably more money than if simply taking the same price everywhere. Multifactor asset pricing analysis of international value investment strategies bala arshanapalli, t. Oct 29, 2017 pricing strategy pricing strategy in marketing is the pursuit of identifying the optimum price for a product. Marketing companies should really target on producing as high a margin as. Company and product market environmental c orp ate objective confirm impact of corporate strategies on pricing policy options evaluation selection of most appropriate pricing option i mpl e nt o use of t actics nd p roc edu s to set sbu prices price m an gement dealing with international pricing problems. The problem in this research is that international pricing decisions are more complex. The paper proposes modelling a pricing strategy process and outlining why and how leadership is important throughout the pricing process.
In pricing decision the cost and market conditions like customer consideration and consumer buying behavior are also very important factors. Factors influencing pricing strategy in international. International marketing managers use a variety of methods to determine appropriate prices. Factors that affect pricing strategies for international, multinational. Geographical and international pricing psychological and promotional pricing discounts and allowances marketing. Pricing strategies 2020 guide with examples quickbooks. Optimization and handling of risks and cost within the service contracts 1 march, 2017. Describe pricing strategies that adjust the base price list the steps involved in determining a price explain the use of technology in the pricing function. Although interest in international marketing has been growing rapidly, little or no attention is given to a pricing strategy involving price discrimination under governmental import restrictions such as. Dec 11, 2017 coke additionally utilizes the international pricing strategy. This is a practice of temporarily selling at prices below cost with the intension of driving out existing competitors or warding off new competitors.
Other pricing strategies in their search for the best price level, wow wees marketing managers could consider a variety of other approaches, such as costbased pricing, demandbased pricing, prestige pricing, and oddeven pricing. Pricing strategy international trade administration. International pricing strategies strategic international. Present the importance of international digital marketing communications and social media communications. Cost data occupy an important place in the price setting.
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