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Questions and Answers
What pricing strategy involves setting a high initial price that decreases over time?
What pricing strategy involves setting a high initial price that decreases over time?
Which pricing strategy is defined by offering several products together at a reduced price?
Which pricing strategy is defined by offering several products together at a reduced price?
What is the term for charging different prices to different consumers for the same product?
What is the term for charging different prices to different consumers for the same product?
Which of the following factors is NOT mentioned as influencing pricing strategies?
Which of the following factors is NOT mentioned as influencing pricing strategies?
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The practice of setting prices based on renowned or luxury expectations is known as what pricing strategy?
The practice of setting prices based on renowned or luxury expectations is known as what pricing strategy?
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What strategy involves setting prices according to competitor pricing?
What strategy involves setting prices according to competitor pricing?
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Which pricing strategy involves setting product prices at slightly below whole numbers?
Which pricing strategy involves setting product prices at slightly below whole numbers?
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What is the main goal of Stay-out Pricing?
What is the main goal of Stay-out Pricing?
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What is the primary goal of market skimming pricing?
What is the primary goal of market skimming pricing?
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What does REVPAR stand for in hotel management?
What does REVPAR stand for in hotel management?
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Which factor is least likely to influence a customer's willingness to pay for a restaurant service?
Which factor is least likely to influence a customer's willingness to pay for a restaurant service?
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Which of the following is an example of sales promotion?
Which of the following is an example of sales promotion?
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What is the main difference between brand advertising and promotional advertising?
What is the main difference between brand advertising and promotional advertising?
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Which type of advertising aims to develop goodwill for a company?
Which type of advertising aims to develop goodwill for a company?
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What classification of personal selling involves directly selling through a representative?
What classification of personal selling involves directly selling through a representative?
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Which of the following best describes yield management?
Which of the following best describes yield management?
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What does the price of a service generally reflect?
What does the price of a service generally reflect?
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Which pricing objective aims to achieve a specific level of profit?
Which pricing objective aims to achieve a specific level of profit?
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What is a common hospitality pricing objective focused on maximizing market presence?
What is a common hospitality pricing objective focused on maximizing market presence?
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Which of the following is NOT an internal factor influencing pricing decisions?
Which of the following is NOT an internal factor influencing pricing decisions?
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What aspect of pricing is unique compared to other elements of the marketing mix?
What aspect of pricing is unique compared to other elements of the marketing mix?
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Which pricing objective focuses on matching competitor prices?
Which pricing objective focuses on matching competitor prices?
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Which of the following factors does NOT directly influence service pricing decisions?
Which of the following factors does NOT directly influence service pricing decisions?
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In determining service prices, what aspect is essential to consider aside from the direct costs of service?
In determining service prices, what aspect is essential to consider aside from the direct costs of service?
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Study Notes
Chapter 5: Price Mix
- Price is the value attached to a service by the provider, reflecting the customer's perceived value.
- Price can be expressed in terms of money, and other ways like interest fees, rent, or salary.
- Price can also reflect the relationship between provider and customer.
- Price includes the tangible product, services, and additional attributes such as delivery, installation, credit, and after-sale services and privileges.
- Price is a crucial marketing element; it generates revenue for the organization.
- The amount of money charged for a service or product.
Most Common Pricing Objectives
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Profit-Oriented Objectives:
- Target Return Objectives: A specific profit level is set as an objective.
- Profit Maximization: Aims to maximize profit.
- Sales-Oriented Objectives: Focus on achieving higher sales volume.
- Status Quo Objectives: Maintain the current price levels of similar products or services in the market.
Hospitality Pricing Objectives
- Factors such as intangibility, perishability, and heterogeneity are crucial to hospitality pricing.
- Hospitality pricing has specific objectives (outlined by Lazer and Layton).
Chapter 6: Promotion Mix
- Promotion includes all marketing communications.
- Advertising: Paid, non-personal presentation and promotion of goods/services by an identified sponsor.
- Types of Advertising: Brand advertising, promotional advertising, advocacy advertising, classified advertising, comparative advertising, institutional advertising.
- Advertising Objectives: New product introduction, detailing product functions, highlighting uses or correcting usage, new distributions, and price adjustments.
- Personal Selling: Informing and persuading through person-to-person contact.
- Types of personal selling include across-the-counter, door-to-door, dealer, and manufacturer.
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Sales Promotion: Activities that complement personal selling and advertising to enhance effectiveness.
- Examples include prizes, contests, sweepstakes, and cross-promotional activities.
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Public Relations: Actively seeking to manage publicity.
- Examples include press conferences, community involvement, and exclusive interviews.
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Direct Marketing: Selling products directly to the public.
- Examples include online marketing, email marketing, and text-to-text marketing.
Pricing Methods and Strategies
- Market Skimming: Initially setting high prices and then gradually reducing them over time.
- Market Penetration: Starting with a low price and increasing it as demand increases.
- Prestige Pricing: Setting high prices for luxury products to appeal to specific customers.
- Price Lining: Setting different prices for products in a specific group.
- Odd-Even Pricing: Pricing products slightly below whole numbers (e.g., $99 instead of $100).
- Bundle Pricing: Combining several products and offering them at a reduced price.
- Bait Pricing: Advertising a low-priced product to attract customers and then upselling them.
- Price Leadership: Setting prices based on the price set by a leading competitor.
- Captive Product Pricing: Setting a lower price for a main product with higher prices for complementary products.
- Price Discrimination: Setting different prices for different customer groups.
- Competition Pricing: Setting prices based on competitors' prices.
- Optional Product Pricing: Increasing the amount customers spend for optional extras.
- Premium Pricing: High prices to reflect the exclusive nature of a product.
- Economy pricing: Low-cost offering with minimal frills.
- Geographical pricing: Varying prices based on location.
- Value pricing: Focusing on providing "value" products/services.
- Stay-out pricing: Setting prices low to dissuade new competitors.
Factors Influencing Pricing Decisions
- Internal factors: Organizational policies, service differentiation, service cost, and marketing mix (the factors within a company that can affect pricing).
- External factors: Demanded of users, different points of consumption or production, competition, governmental regulations.
Factors Affecting Customer Willingness to Pay at a Restaurant
- Uniqueness of the menu
- Food and service quality
- Chef's reputation
- Restaurant ambience.
- Additional factors like ongoing promotions, holiday promotions, special event pricing, package promotions, and competitive pricing.
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Description
Explore the intricacies of price as a vital component of marketing in Chapter 5. This quiz delves into pricing strategies, objectives, and the relationship between providers and customers. Understand how pricing impacts revenue and market positioning.
