Competitions are always there and when a competitor charges low in comparison to our price this can cause a problem, because it increases the perception that cheap is better. So, this can be a very challenge to create that brand awareness. High unit costs. The unit costs is usually high of such companies because the sales volume is quit low. It is only for a premium segment and thus it makes a huge difference.
The company may face the risk of cannibalization of its other products that are not promoted. The company is also at the danger of ruining its product image if the prices are lowered too much. The duration of the sale and which retailers to include is also of utmost importance. The company must also estimate the revenue that will be expected to be generated from the
It will charge high price If company is using intensive advertising to promote the sale of product then it. There are various other marketing methods which affect price of a product type of packing, distribution system, salesmen employed, customer support services etc. It is because of prices that a customer is very sensitive to any product. Various names can be given Price for example, price for medical , price for using road etc. is toll, price for job is salary, price for apartment is rent etc.
Ac-cording to a study regarding consumer’s responsiveness to sales promotions (Rohr et al. 2013), consumers are highly influenced by such price discounts which affect their purchase decision. The interesting or challenging fact is that customers tend to buy any spirit brand, if it is under price promotion, which means that loyalty is not that high, if the price is attractive enough. This problem was faced over the past years, and brands spend a lot of time and effort for making brands competitive enough to assert themselves against its competitors. There-fore, it is vital for the brand to be attractively represented at the point of sale, in-cluding several merchandising materials, which create high visibility.
The objective of promoting the products during market introduction is informing and begin to build primary demand if the product is a brand new that never existed in the market before. At this stage, firms experiencing low sales as the customers are waiting to be persuaded and price is high as the product is new as a result of high research and development costs that need to be recuperated. The marketing objective for the company of this stage is to create awareness and stimulate trial which cause the initial purchase of a product by a consumer. Besides, firms do not have profits or positive cash flow but on the other hand, firms need to spend large amount of capital in advertising the product vigorously and promoted it to gain market share. Companies spend heavily on advertising in this stage to stimulate primary demand, which is more focus on the aspiration for the product range rather than for a specific label, since there are only few competitors with the same products.
This is because it helps to promote the product that has been produced in order to reach customers. Other areas of an organisation do not, they merely help the running of the organisation. This is a major importance of marketing to an organisation. In this half of the essay I will mention the factors influencing the buying decision process. Advertising campaigns have a major influence on consumer buying behaviour.
Soft drinks have been part of the lifestyle of the people and everyone prefers a particular brand. Companies use advertisements to attract its target audience. Advertisements play a major role and positive effect on consumer’s buying behavior. According to Vivekananthan (2010): There are numerous advertisements in medias; television, radio, newspapers and magazines but, the important question for a marketer is “do all these advertisements positively influence the consumers’ brand preference?” If [an] advertisement [does] not create any positive change in [the] consumers’ brand preference, all the resources such as money, time[,] and efforts spent on advertisement will go in vain…. Companies must first understand the buying behavior pattern
Technical and expensive products rely on professional selling while products that are purchased routinely rely on advertising. Purchasing decisions are easier in products of low involvement while high involvement products require much work by retailers using more tools of the communication mix. Retailers are challenged by customers to find out their readiness to purchase and to find out the target market characteristics. Retailers need to find the different types of media and which to choose for different target
There are positive and negative social and individual effects of advertising. One positive social effect is the impact of materialism on economic growth. Most noticeable of the negative effects is the effect on the environment and the diminished overall sense of wellbeing. This in turn impacts families as a whole and filters into the psyche and behaviour of developing teenagers. (Garrett, D. E. 2010), Research the debate as to whether consumers are disadvantaged or vulnerable based on demographics, income or age and education.