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Chapter 10 Product, Price, and Place
Chapter Summary
Section 10.1 Product
• Product, together with place, price, and promotion, make up the four Ps of
marketing. A product can be a good, service, or idea.
• Using the appropriate product strategy will help the business out-sell
the competition and meet a consumer need. Product strategies include
branding, packaging and labeling, and developing new products.
Section 10.2 Price
• Price is one of the four Ps of marketing. A product’s price will have a
significant effect on whether or when a company will make a profit.
• Pricing decisions are determined by a number of factors. Included among
these are expenses, competition, laws and regulations, product life cycle,
as well as supply and demand.
• Price objectives are driven by the short- and long-term goals of the
company. Finding the right price requires finding the right balance
between an amount at which customers will buy and one that generates
enough profit for the business.
• Pricing strategy is based on a company’s pricing objectives. Pricing can
be cost-based, demand-based, or competition-based.
• Pricing techniques include psychology pricing and discount pricing.
Psychology pricing is most often applied to retail prices, the price at which
something is sold to a consumer. Discount pricing is used in both B2B
transactions as well as B2C transactions.
• Many businesses use web-based pricing software or other pricing
technology when determining prices. Using technology makes the
process more efficient.
Section 10.3 Place
• Place is one of the four Ps of marketing. Place is the means by which
customers will receive the products.
• Efficient management of a supply chain is important to a business’
success. Effective supply chain management streamlines inventories,
lowers operating costs, ensures timely product availability, and increases
customer satisfaction.