Examples Of Pricing Strategies

What is a price? Narrowly, price is the amount of money charged for a product or services; Broadly, price is the total of values and costs that consumers exchange for the advantage of using the product or service (Kotler, Armstrong, Ang, Leong, Tan & Yau, 2009). Price is flexible and it can be changed quickly. It is a significant aspect of every company because it can give direct effects to the sales and profit. When the product priced too high, no customer are willing to buy and cause a loss of profit. So, a smart marketer will use pricing strategy to create and capture value of the customer in order to build strong customer relationships.

Major Pricing Strategies

For the major pricing strategies, Tealive used customer value-based pricing which is focuses on perception of buyer on value rather than the cost of the seller (Kotler, Armstrong, Ang, Leong, Tan & Yau, 2009). Moreover, it has adopted a good-value pricing strategy which is offering the right combination of good service and quality at a fair price (Kotler, Adam, Brown & Armstrong, 2006). The company set an affordable price with high quality product and good service for their customers. Furthermore, cost-based pricing is used to set prices based on the total cost of the product and add into the selling price (Kotler, Armstrong, Ang, Leong, Tan & Yau, 2009). When a firm has a lower cost,

It is using the product-line pricing which can set the price across the entire product line (Kotler, Armstrong, Ang, Leong, Tan & Yau, 2009). The product line can compare related product by price, different volume of packaging and different flavour. For instance, regular size of the Original Milk Tea is RM5.50 whereas large size is RM6.50. Consumers will prefer to purchase large size of beverage as every consumer favour product which is more worthy and can give them higher