Marketing Management — Part 2: Price, Place and Promotion: visual lesson, CBSE Class 12 Business Studies

Lesson

Price, Place and Promotion

Part 2: the price decision, channels and physical distribution, and the promotion mix.

In this lesson you will

Part 2 at a glance

Diagram

Imagined figures. Cost sets the floor, utility and demand the ceiling; competition decides where in between.

Diagram

Table of six factors affecting price: product cost sets the floor; utility and demand set the ceiling; competition keeps price near rivals; government may cap prices; pricing objectives; and marketing methods used
Factor	Effect on price
Product cost	Sets the floor: fixed, variable and semi-variable costs must be covered in the long run
Utility and demand	Sets the ceiling; inelastic demand allows a higher price
Extent of competition	Close substitutes keep price near rivals'
Government and legal regulations	Notified or capped prices for essential goods
Pricing objectives	Profit, market share, survival or quality leadership
Marketing methods used	Service, credit, packaging and promotion change cost and value