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Marketing Project

ABC Inc. manufactures pens, pencils and stationery. The company sells primarily to office supply stores and discount chains. The CEO hoped to produce large volumes at low prices. However, in early months ABC experimented with pricing to target different markets using a market penetration strategy. International expansion would impact pricing due to increased costs such as marketing, distribution and customs. Quantity discounts may not be possible as ABC needs to maintain product quality to attract regular customers.

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1K views3 pages

Marketing Project

ABC Inc. manufactures pens, pencils and stationery. The company sells primarily to office supply stores and discount chains. The CEO hoped to produce large volumes at low prices. However, in early months ABC experimented with pricing to target different markets using a market penetration strategy. International expansion would impact pricing due to increased costs such as marketing, distribution and customs. Quantity discounts may not be possible as ABC needs to maintain product quality to attract regular customers.

Uploaded by

rabirabi
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOC, PDF, TXT or read online on Scribd
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ABC Inc. is a manufacturer of ball-point pens, pencils, and stationery.

The firm’s primary


distribution strategy is to sell in large volumes to office supply stores and large discount
chains. Mr. XYZ, CEO of ABC Inc. had hoped to manufacture and sell in large enough
quantities that prices could be held low. However, in the first several months, the firm
experimented with the price portion of its marketing mix in an effort to cater number of
markets.

1. In starting out with a market-penetration pricing strategy at ABC Inc., what


assumptions could be made about the market(s), it was serving?

2. Why might have Mr. XYZ avoided using market-skimming pricing at ABC Inc.?

3. How could optional product pricing be used by ABC Inc.?

4. How might product line pricing be initiated at ABC Inc.?

5. If ABC Inc., decided to introduce its products internationally, what factors may
impact a change in price?

6. Explain how product-form pricing may be a pricing option at ABC Inc.,

7. Would quantity discounts be possible for ABC Inc., to offer? Why?

Q:-1 In starting out with a market-penetration pricing strategy at ABC Inc., what
assumptions could be made about the market(s), it was serving?

Ans:-

The company A.B.C. Inc. needs to develop the market and customers when a company launching
a new product in market, company gives attractive polices to attract the buyers in this strategy
marketing penetration pricing company offer the low prices at the initial stage. In this way
company A.B.C. Inc, quickly produce buyers in market. When the sales volume is high it is
directly effect on the cost of manufacturing low price cost must help the company to face the
competitor, when the brand and company establish in market. The company A.B.C. Inc. can
enhance the price.

Q:-2 Why might have Mr. XYZ avoided using market-skimming pricing at ABC Inc.?

Ans:-

Mr. XYZ avoids the marketing skimming price because in marketing skimming it is
must that product quality and image sport the price. In this cause Mr. XYZ launching a new
product in the market. Marketing skimming is the strategy of high pricing. Mr. XYZ is not able
to introduce his product on high rates because product needs to stability.

Q:-3 How could optional product pricing be used by ABC Inc.?


Ans:-

Optional product pricing means to sale the general product with basic product. Mr.
XYZ can not use this policy because when the market of any product developed it is possible.

Q:-4 How might product line pricing be initiated at ABC Inc.?

Ans:-

Product line pricing can effect on A.B.C. Inc, if the quality difference is minted in the
product. The cost of product is different and the company can set the pricing in line it the price of
pen is high and the price of ball-pen is low. Then sellers adjust the prices with quality difference.

Q:-5 If ABC Inc., decided to introduce its products internationally, what factors may
impact a change in price?

Ans:-

I think it is very difficult to marketing the any product internationally. If we have any
monopoly which had demanded in the several countries then it is possible. In this cause company
producing in low rate item so it is very difficult for company manage the abrade expenses.
Custom tariff and taxes is another problem to face the company. International marketing vary to
country and purchase power of buyers also very country to country so it is not easy for the
A.B.C. Inc to market this product internationally.

If company decides to introduce product internationally the following factors may impact.

1. Marketing cost would increase.

2. Access to market cost would increase.

3. More distribution channel would be required.

4. Promotion cost will increase.

Q:-6 Explain how product-form pricing may be a pricing option at ABC Inc.,

Ans:-

My suggestions for company A.B. Inc to set the prices is bundle prices. In this method
company A.B.C. Inc offers the several products in bundle price. Bundle pricing promote the sales
of product. In bundle pricing all the product of combined and the pricing is low. That’s why
buyers purchase the bundle pricing is easily.

Q:-7 Would quantity discounts be possible for ABC Inc., to offer? Why?
Ans:-

I think it is impossible to compromises at the quality of products of company A.B. Inc.


first time buyers buy the product due to low price but the quality of product is good, then he will
become the regular buyer of the product. So my opinion for A.B. Inc, is this don’t he discount
their quality

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