Problem:
A former co-worker now represents a company that manufactures a new type of laboratory-made gemstone, called ZC, which is similar to, but better than, cubic zirconia. These gemstones are used in rings, pendant type necklaces, bracelets and pins which your firm designs. While they have begun to sell their ZC jewelry to selected stores, they have just received an invitation to sell their ZC products on one of the largest television home-shopping networks in the United States with the potential, if the products sell well, for an airing on the network's European show. Your friend`s company must now determine the best pricing method for their products in this environment.
The television program has given them complete control over how your products will be priced.
Your former co-worker brings this challenge to your marketing networking association. meeting.
Seven pricing methods are to be considered are the following:
- Going-rate or competition-based pricing
- Perceived-value pricing
- Value pricing or "every day low pricing" (EDLP)
- Markup or cost-plus pricing
- Target-return pricing
- Group pricing
- Auction pricing
The task will be two fold -
Evaluate and determine the advantages and disadvantages of markup or cost-plus pricing for this special marketing situation.
State the advantages and disadvantages of each of the above pricing strategies as applied to this new type of product and to this marketing situation. Be sure to share within this portion (1) any personal experience you have with any of the other pricing strategies for ZC jewelry that you did not choose to evaluate, and (2) any suggestions for new potential pricing methods that are not described as part of the standard seven pricing methods, or (3) any pricing strategies which combine several pricing methods.
This can be an interesting and creative task. I trust your insight and creativity and believe you will deliver an exemplary product in the provided timeframe. I just ask that the information that is pulled from outside sources not be excessive and be quoted according to APA guidelines both in text and end of paper. It should be a task compiled from inner creativity, knowledge and backed up with references and facts. Please avoid paraphrasing too much throughout the paper. It should be one that showcases your own knowledge, creativity and writing skills coupled with references and facts. You should showcase your knowledge and skill but support it with proper research and facts. Please also refrain from utilizing Wikipedia as it is not an accepted source by the institution and check spelling, grammar, content, flow as well as verify all information is property cited both in text and end of paper according to APA format.