Pricing Strategy

1.the product itself: the cost of producing plus your expecting profit

2.similar products, the rival firms: What are their prices? What are your product’s competitive advantages? In what aspect does your product superior to others? This can add extra value to your product.

3.target customer: Whether they are wealthy or not? Can they afford the price?

Ex: How to ensure that price levels for new products are set appropriately?

○1 The first problem is who your target customers are. Their income, occupation, preference.

○2 Do market research to make sure whether your target customers can afford the price level. There are mainly four ways of doing market research: survey, telephone interview, observation and questionnaire.

○3 Test your product in a small region. Find out how it sells, get the feedbacks of the customers. Decide whether to make any adjustment.