Principles of Marketing, 17/e

Major Pricing Strategies

Author Comment

Setting the right price is one of the marketer’s most difficult tasks. A host of factors come into play. But as the opening story about Walmart and Amazon illustrates, finding and implementing the right pricing strategy is critical to success.

The price the company charges will fall somewhere between one that is too low to produce a profit and one that is too high to produce any demand. Figure 10.1 summarizes the major considerations in setting prices. Customer perceptions of the product’s value set the ceiling for its price. If customers perceive that the product’s price is greater than its value, they ...