MOD CASE 3

MOD CASE 3

Introduction

The promotional pricing strategy has been over-used in the retail markets and buyers have developed a healthy skepticism about the reality of the 'deal'. One of the most often used promotional pricing strategies is the "Going Out of Business" sale; the sale seems to last for years and the business eventually just 'goes out of business' at that location but then restarts elsewhere. (Fulton 2010) Be careful with how you use promotional pricing. There is still room for some effective promotional pricing programs in the business-to-business markets; be smart in how you develop your pricing strategy.

Promotion Strategies

Fitness / Exercise Product

As a reseller of name-brand products, we have very little control over how our customers view each individual product. We do, however, have control over the customer environment and the manner in which we display our products. From a standard retail standpoint, product marketing appears to be very simple - display the products in an aesthetically pleasing manner, and they will come. It is much more complicated for us. We have identified three types of customers, and each group has it's own buying pattern.

The hard-core climbers need a great selection of gear, and will be disappointed if they aren't offered a 'bargain bin' of last years' model gear. The hard-core gear shoppers will be separated from the curious by a low glass partition. This partition will serve both to absorb the noise of shoppers and eaters, and to separate and maintain the climbers' social order. We will host climber discussion groups, with free coffee on Friday. and Sat. nights after 7:00 p.m. This will give hard-core climbers an opportunity to exchange stories and relax in our cafe, away from their nemesis: 'yuppie tourists'.

The weekend warriors won't feel excluded from the gear, and will also partake of the bargain bin. The warriors will find comfort in the cafe area, where they can talk about their pursuits rather than challenge them on the rock face. These people are not in great shape, and are likely to flock to the store as early as 3:00 p.m. for ice cream and cookies. We'll have extra staff on hand during these times.

The curious are difficult to gauge. They will flow in and out all day, and are likely to peruse our magazine rack for hours (we've allowed for the magazine write-offs). This customer base is our most lucrative, and is most likely to buy an iced espresso and/or ice cream before or after their short day hikes. Since espresso is a cash cow for us, we'll offer them a solid selection of beverages so nobody's disappointed.

Advertising will be secondary.

Owver will be paid up to $2,000 to determine the needs of the surrounding population and how the company may best meet those needs with promotions, literature and other marketing programs..

Promotional campaigns will be partially outsourced to other famous company.

Advertising will be consistent .

Sales promotions and public relation strategies will work together to inform customers of new products, to encourage ...