Brand Strategies and Product Life Cycle: Pricing Techniques
Posted by Jose Carlos Teruel Torregrosa and classified in Spanish
Written at on 
English with a size of 2.9 KB.
Brand Strategies
If a single product is damaged, the entire brand image can be affected. Brand strategy is usually used for similar products.
Multiple Brands
- Individual brand strategy: Using a different name for each product.
- Product line brand strategy: Using the same name for products that have a relationship with each other.
- Second brand strategy: Used by companies that have other, more prestigious brands in the market. Objective: To cover a larger market segment.
Distributor Brands
These are brands manufactured by a specific industry and offered to the consumer under the name or brand of the distributor or retailer, who will be the one to carry out all promotional and communication activities regarding them.
Product Life Cycle
Products have a life cycle, that is, a period in which they are born, grow, mature, and die. The lifespan of products is very different depending on their nature.
Characteristics of Each Stage
- Introduction or launch: The market release of a completely new product or an innovation on an existing one. Sales are low, and their growth is slow.
- Growth: The product begins to be known, and sales experience strong growth. Advertising goes from being informative to being persuasive.
- Maturity: The speed of sales growth stabilizes, and sales remain more or less constant for some time.
- Decline or saturation: Sales fall considerably. The company has to consider whether to relaunch the product or let it cease to exist.
Pricing
The amount of money that the buyer of a certain good or service delivers to the seller in exchange for its acquisition. It is the marketing variable that most quickly influences consumer decisions, which is why its study is so important.
It depends on many factors: product cost, market demand, competition, the phase of the life cycle in which the product is, etc.
Pricing Techniques
Based on economic theory: Objective: Maximize revenue. There is a direct relationship between price and quantity offered. There is an inverse relationship between price and quantity demanded. Depending on the price elasticity of demand, the company may be interested in lowering or raising its prices to achieve the objective of maximizing revenue.
Based on costs: Consists of adding a certain profit margin to the cost of the product. It is simpler than the previous method since the information needed is more accessible to the company.
Based on competition: With the previous method, you have an idea of around what figures our price should be, but the exact figure is decided by studying the prices of the competition.