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.
Individual Work: Each group member should select one or more of seven pricing methods (listed below) to evaluate and determine the advantages and disadvantages of his or her chosen strategy for this special marketing situation.
The seven pricing methods are:
* 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
I prefer the Markup and cost-plus pricing!