Difference between Pricing stategies and methods (1 Viewer)
- Thread starter Minki
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Hi Minki, an important part of business studies is to memorise the syllabus which might be making a song or writing the syllabus again and again.
In the syllabus it falls under
Under marketing -> marketing strategies ->
price including pricing methods – cost, market, competition-based
– pricing strategies – skimming, penetration, loss leaders, price points
The syllabus is listed here: https://educationstandards.nsw.edu....usiness-studies-st6-syl.pdf?MOD=AJPERES&CVID=
In the syllabus it falls under
Under marketing -> marketing strategies ->
price including pricing methods – cost, market, competition-based
– pricing strategies – skimming, penetration, loss leaders, price points
The syllabus is listed here: https://educationstandards.nsw.edu....usiness-studies-st6-syl.pdf?MOD=AJPERES&CVID=
well, hopefully you have a set of notes by now, the only way to know the difference is to memorise what each is.
in my mind, the difference between the two is as follows:
pricing strategies deal with the WHY you set a certain price. because it's strategy. do you want to rip off people as much as possible before you get competition and people start buying from others? or perhaps you want to set a low price so you gain market share. or heck, maybe you're going to sell at a loss, because you know that once customers are in your shop, they'll probably buy something else too, and you'll make your profit on these other things. (each of the things i've mentioned more or less correlate with one of the syllabus dot points - make sure you know which one is which)
pricing method deals with how you come up with the exact number you're going to sell at. it's more the practical aspect of coming up with a numerical number taht will be your sale price. eg let's say you've decided to sell reasonably cheap (but not at a loss). well, how much is that going to be? it depends on how much the good cost you, so you first need to calculate how much it costs, then you can add a bit of a margin so you get some profit, etc etc.
in my mind, the difference between the two is as follows:
pricing strategies deal with the WHY you set a certain price. because it's strategy. do you want to rip off people as much as possible before you get competition and people start buying from others? or perhaps you want to set a low price so you gain market share. or heck, maybe you're going to sell at a loss, because you know that once customers are in your shop, they'll probably buy something else too, and you'll make your profit on these other things. (each of the things i've mentioned more or less correlate with one of the syllabus dot points - make sure you know which one is which)
pricing method deals with how you come up with the exact number you're going to sell at. it's more the practical aspect of coming up with a numerical number taht will be your sale price. eg let's say you've decided to sell reasonably cheap (but not at a loss). well, how much is that going to be? it depends on how much the good cost you, so you first need to calculate how much it costs, then you can add a bit of a margin so you get some profit, etc etc.