Chapter 9
THE PRICING PLAN
SUMMARY
- Cost-plus pricing approaches and their dangers
- Portfolio management, lifecycle analysis, product positioning and pricing implications
- Costs as an input to pricing decisions
- Pricing for channels
- Gaining competitive advantage through value-in-use
- How to prepare a pricing plan
- Exercises to turn the theory into practice
INTRODUCTION
Those readers who believe they already know enough about pricing, channel strategy and CRM, and who are principally concerned with the preparation of a strategic marketing plan, can go straight to Chapter 12.
The first important point to be made about the pricing plan is that very rarely is there a pricing plan in a marketing plan!
The reason is not too hard to find. Promotion, in all its various forms, can be managed and measured as a discrete subset of the marketing mix. So too can marketing channels. But while the product itself, the price charged, service elements and communication strategies are all part of the ‘offer’ which is made to the customer, price itself is such an integral part of the offer that it is rarely separated out and put into a plan of its own.
It is more common to find objectives for a certain group of products or for a particular group of customers, with a pricing strategy attached to it in whatever detail is necessary to indicate what the pricing policy is expected to do to help the company achieve its marketing objectives.
However, we have chosen to address the issue of pricing as a separate ...
