"Pricing" - The element taken for granted in Marke
"Pricing" - The element taken for granted in Marketing
Despite the importance of effective pricing for marketing success, many organisations only pay lip service to same. The reasons could be,
(a) A lack of understanding, of the true strategic value of sound pricing strategy.
(b) The overreliance on finance personnel, to independently formulate pricing policy and strategies.
(c) The lack of financial/costing knowledge on the part of marketers.
Whatever the reasons may be, it is time that a professional integrated approach be taken towards pricing policy and strategy. Basically, pricing decisions should not be left to finance personnel alone. Marketing personnel should be actively involved in the process as well.
Pricing in a Sri Lankan context
Sri Lankans are very price sensitive, in most purchases. The reason are obvious, considering the fact that the country is very much in need of development. The most important facet in Sri Lanka, is the investment required in purchasing products and services. In other words, how many rupees need to be tendered. As against the investment required, Sri Lankans in a majority of instances do not compare the product volume purchased. (Ex. litres, grammage). This is an important aspect for Sri Lankan marketers to note. Always consider the price point, from an investment perspective, not from a volume/content perspective alone. Try and marry these two aspects, as closely as possible.
Another aspect is that Sri Lankans, are extremely "value conscious". (Value for money). They demand greater value, for every rupee spent! As such, providing value through astute pricing, is a major ingredient for success. Of course in inflationary environments, it is not an easy task. A careful balance between the value proposition and investment, has to be met.
Pricing strategies in Sri Lanka, are based mainly on cost/mark-up considerations. There are inward factors and do not reflect the realities of the marketplace. As such, the need in Sri Lanka, is for market focused pricing strategies, given the competitive intensities prevailing in the global environment.
Why is it important to "integrate" pricing decisions, together with other elements of the marketing mix?
Pricing decisions cannot be taken in isolation. They need to be integrated with the other elements of the marketing mix. Not to do so, could lead to ineffective marketing and a wastage of resources.
Take for example, a brand such...