PRICING STRATEGY

The Marketing Mix: Price

The Marketing Mix: Price

Introduction

Procter & Gamble commonly known as P&G is one of the largest multinational corporations with offices present all over the world. The company has managed to clinch the leading position in producing consumer goods the areas of pharmaceutical, cleaning supplies, personal care, and pet supplies and others. For this module, P&G has been assumed as the company who has asked to provide a pricing strategy for its product in Haiti. The company needs to decide where to position its product on the quality and price as well as considering other factors in setting pricing policy like fixed and variable cost (including: wage, rent, interest, overheads and others).

These are the things that tend to make prices more rigid, i.e. less sensitive to changes in supply and demand. However, the price is a basic controller in the economic system because it affects the distribution of these inputs. In addition, there are some psychological aspects of the price that must be taken into account before devising a pricing strategy for the company. The market of consumer goods is highly saturated, besides traditional rivals like Unilever and Johnson and Johnson, in every market the company has to face local competition as well. In this connection, this study will devise the pricing strategy using the customer-oriented approach, means what it costs the customer to own the products of P&G?

Price Setting

There is a fact that consumers rely heavily on price as an indicator of product quality; especially, when consumer make decisions purchase a product without complete information (Lauterborn, 2001). Of course, perceptions of product quality by consumers may also be influenced by the reputation of the shop, advertising or promotion of the product and other variables. In this connection, P&G should set prices trying to exploit potential ...