11. Pricing strategies.

Strategy of the high prices

Strategy of the high prices is applied, as a rule, to new, for the first time appeared on the market and to the goods protected by the patent. This strategy use also for the goods in relation to which apply the so-called "prestigious" price and which is focused on the buyers giving great value to quality, uniqueness, the goods status. The purpose of strategy of the high prices - superprofit reception by «removals of cream» from that group of buyers for which these goods are of great value. Strategy of "removal of cream» is possible, when the firm is convinced, that there is a circle of buyers ("pioneers", fans new), which show demand for these goods under any price if only to own these goods at present. After the lapse of some time when this segment of the market will appear sated, the firm gradually reduces the price to pass to development of other segments of the market, passing, thus, from the high, prestigious price to the price «to penetrations.

In the high prices the firm has an opportunity:

• To reveal new segments of the market (originally strategy of the high prices is spent for the segments not sensitive to the price);

• To receive the information on demand, production costs; to delay response concerning the prices from manufacturers of similar production;

• Qualitatively to improve production;

• Faster to cover a part of the expenses connected with research and working out of new production.

• Strategy of the average prices

Strategy of the average prices is the most typical strategy for the majority of firms. As a rule, those firms which are interested in stability and preservation of a favorable climate for the activity in the market resort to this strategy and consider profit reception as the long-term policy. Many firms consider strategy of the average prices of the most fair as it excludes possibility «wars of the prices». Besides, this strategy does not lead to occurrence of the new competitor, does not allow separate firms to make profit at the expense of buyers and at the same time gives the chance to receive fair profit on the invested capital.

Strategy of the low prices

Considering strategy of the low prices, we will notice, that here it is a question not about «бросовых* the prices, and of rather low prices for the goods which it is ready below the prices of the similar goods-competitors. This strategy is popular, it is most safe for firm as thanks to unattractiveness for potential competitors reduces the risk arising because of the unknown relation of the buyer to the new goods.

Strategy of the low prices is used by firms on purpose:

• Penetrations on a foreign market;

• Increases in a share of the goods in home market;

• Exit on the mass market;

• дозагрузки capacities;

• недопущения bankruptcies at the given stage;

• Counting on that for the goods there will be a commodity market for a long time.

• Strategy of the low prices is known still as «the price недопущения», «the replacement price».

• Strategy of the target prices

Appointment of strategy of the target prices (or target profit) is the certain size of profit: for example, high profit within any concrete year, satisfactory volume have arrived for a number of years (for example, 20 million rbl. a year within 5 years); reception of certain percent of profit (for example, 15-20 %) on the invested capital. At realisation of this strategy sales volumes and the prices can vary, but the planned size of profit should be provided.

Strategy of constant prices

The firm can aspire to an establishment and preservation throughout long time of constant prices for the goods and services. In case of growth of production costs the firm instead of revision цеп towards increase reduces weight of packing, changes goods structure etc. Thus it is supposed, that the consumer prefers such changes to growth цеп.

Strategy of the changing prices

At this strategy the firm changes the prices as soon as there was a change of production costs and demand.

Strategy of reduced prices

At strategy of reduced prices of the most running goods the shop establishes the prices below cost or below a normal market price. The purpose of such strategy for retail trade - attraction of buyers in shop in hope, that with these goods they will buy also other goods under the normal prices, and for manufacturers - increase of interest of buyers to all ассортиментной to group. Shops at this strategy manage to increase considerably a turn. The goods it is necessary to choose such, which prices buyers easily remember. Buyers, repeating purchases, can get used to visiting of this shop. However it is necessary to mean, that too long sale of the goods for undercharges can lead to that buyers begin to perceive such prices as normal. From here follows, that strategy of reduced prices can appear improper for long time, we Will notice, that sale of the goods under the prices below cost is illegal.

Strategy of the prices for the goods interconnected from the point of view of production costs

Two goods are considered interconnected from the point of view of production costs if change of volume of manufacture one causes change of expenses for manufacturing of another. It concerns the collateral and accompanying goods. Reduction of volume of release of one goods will lead to increase in expenses at manufacture of another as constant expenses concern a pas smaller quantity of production.

Therefore, before to make the decision on change of the price of one of the goods of such assortment, it is necessary to analyse, what change of production costs behind it will occur. Besides, the various goods from assortment let out by firm are under different influence of a competition. If the competition is strong, the seller has the limited possibilities for a variation of the prices. In other cases freedom of actions can be the most different. Therefore the structure of foams of let out assortment of the goods should be proportional to their industrial costs and should reflect possibilities of reception of profit on the sale, put in pawn in various level of the competition existing in the market.

Strategy of the prices for the goods interconnected from the point of view of demand

Two goods are interconnected with a point demand debate if the price of one influences demand of another. In most cases it concerns group of the goods where one goods can replace another in consumption. For example, female suits of three price categories: expensive, average, cheap. The firm should establish the prices for all these goods so that as a result to receive the maximum profit. If the firm starts to reduce the prices, for example, only a pas expensive suits it will lead to reduction in demand for cheaper. Therefore, before to reduce the price for any goods from let out group, the firm should count possible changes of demand of a pas all other products and define, how in this connection reduction of prices the general size of received profit will change.

Strategy of the prices concerning reflexion in them qualities of the goods

The firm at definition of level of the price for the goods always estimates its quality. High quality in most cases means the high price for firm. Price level can form base of an estimation of quality of the offered goods. The price is quite often used by firm as means of allocation of the goods of model "lux" from usual models. The difference between цепами on such models should be much more above, than a difference in expenses. The high price for the goods can serve as the tool of creation of reputation of the goods of the majority of the firms which are letting out wide assortment, and also to be one of sources of reception of additional profit. Some large firms, which price strategy it is directed on penetration on the market, on the qualitative goods establish the reasonable prices. Instead of consumer attraction to the goods of high quality they work as the high price over decrease in an overhead charge, search for effective ways of purchases of raw materials and materials, improve the manufacture organisation.

Strategy of the prices and reputation of firm

To firm it is not indifferent, what relation has developed at buyers to its goods and to her. The relation of the buyer to the goods in the market is defined by its last experience, goods estimation other buyers, the first impressions. An effective remedy of strengthening of reputation of firm in the market are the mark of firm and the price. The firm can create what image to itself, depends on its financial and other possibilities; in case of their limitation desirable representation will not be reached.

If the firm has created to itself reputation of the manufacturer of expensive high-quality goods by working out of a new series of the goods it hardly will go on a way of release of the goods cheap, low quality. This firm will concentrate the efforts to high quality of the goods, to establish the high prices for them and at advertising to try to avoid accent on цепе the goods.

Strategy of the flexible prices

According to strategy of the flexible prices the firm changes the prices for the goods depending on ability of the buyer to bargain, or, otherwise, from its consumer force. Buyers who can bargain, pay lower prices, than those who is not able to do it. The flexible prices meet in the markets where individual transactions consist more often. Basically it is the goods of an industrial function, service. This results from the fact that buyers of such goods well know them and are able to bargain. Jeweller, antique shops often use the flexible prices. In some markets firms do not have other exit how to reduce a price to level of the price of the competitor. If the firm does not reduce the prices, buyers will go to appeared the leader in the market to the competitor while in a warehouse it has goods. In the modern competitive market of firm lead more and more flexible price strategy, refusing from rigidly fixed prices.

Strategy of discounts from the prices

The firm at certain market situations for position strengthening in the market can use various discounts from the prices. The cores from them are listed more low.

• Discounts from the price for purchase большего quantities of the goods - are established for the purpose of preservation of the greatest possible sales volume.

• Discounts «for payment by cash» - represent reduction of price for those buyers who operatively, faster a target date pay accounts. Such discounts for the purpose of improvement of liquidity of the seller, reduction of expenses in connection with collecting of credits, bad debts and for other reasons are applied.

• Discounts from the price under condition of delivery by the buyer, both the old sample of the goods of firm, and a product of firms-competitors. The purpose of such discounts - maintenance of a sales volume and profit on possible a maximum level. At the given strategy of the price more low, and the profit can be above. The considered discount is not the general reduction of prices. Each returned product of the given firm has residual cost (there are parts of a product which can be restored and used), and it is possible to hand over the returned product of competitors in scrap metal and to receive the certain sum.

• Seasonal discounts - are established for the buyers making out-of-season purchases of the goods and services.

• Bonus discounts - are given to steady customers if they for the certain period get the caused quantity of the goods.

• Special discounts - become for those buyers in whom the firm is especially interested (large wholesalers or firms who with the seller have special confidential relations, steady customers). Such discounts, as a rule, are a trade secret.

• Dealer discounts - pay expenses of the dealer and provide to it the caused profit.

• Export discounts - are given by sellers to foreign buyers over those discounts which operate for buyers in home market.

• Progressive discounts - are given to the buyer under condition of purchase of a considerable quantity of goods already known to it by it.

• Club discounts - are given to members of national and international discount clubs on services and the goods.

• Preferential discounts - are established with a view of stimulation of sale of certain kinds of the goods.

• Samples are an offer of the goods to buyers free of charge or on test. Samples carry on houses, dispatch by mail, distribute in shop, apply on any other goods. Distribution of samples - the most effective, but also the most expensive way of representation of the new goods.

Strategy of the discrimination prices

The essence of strategy of the discrimination prices consists that the firm at the given approach to definition of the prices does not consider distinctions in production costs, and considers distinctions in consumers, the goods, a place, time etc.

The establishment of the discrimination prices is carried out in following forms:

• The establishment of the prices for the goods or service taking into account versions of buyers, for example, in museums from students and children take a smaller payment for an input;

• The establishment of the prices taking into account variants of the goods, for example, an iron with an alarm bulb in comparison with precisely same iron, but without a bulb can cost for 10 rbl. more expensively though this bulb, including its installation, can cost only 2 rbl.;

• The establishment of the prices taking into account a site, at the given approach the goods is on sale under the different price in different places though costs in these places are identical (for example, tickets at cinema, theatre);

• The establishment of the prices taking into account the time factor, in this case the price varies depending on time of days, a season, day of week.