This is just a response to a discussion. ExpectationFirst reply demonstrates at least 2 of the following: knowledge of content, connection with other student, and organized, clear, concise, and focused writing.=========================================================================================Expectation Second reply demonstrates at least 2 of the following: knowledge of content, connection with other student, and organized, clear, concise, and focused writing.pls see attachment.
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Expectation
First reply demonstrates at least 2 of the following: knowledge of content,
connection with other student, and organized, clear, concise, and focused
writing.
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Hello class,
Excellent day to post this discussion! The product I paid a “little” too much for today was
a Victoria’s Secret product. Knowing this brand tends to run on the pricier side, I tend
not to shop there anymore, unless I have a gift card. For my single product, it cost
$62.50 before tax. Now, I can buy a similar product in a 2-pack for a sixth of that price.
Obviously, the quality of the product is factored into that price, but another part of it is
the brand name itself. Women know Victoria’s Secret to be a luxury item store, but what
attracts them? If I did not have to gift cards for the store, I would have taken my
business elsewhere, but I know I will never use them otherwise. While I was in the
store, I noticed they had their semi-annual sale going on. 60% off most of their items
(except the one I was interested in!). “Sales of items priced between $65 and $74.99
contributed the most dollar gains to the category in 2018, to the tune of $131 million,
despite being a relatively small share of the bra market,” (The NPD Group, 2019).
During this sale, Victoria’s Secret uses the High/Low pricing. “The strategy attracts
customers who are not price sensitive (pay the regular amount) and the discount
shopper who will buy it on sale,” (CSU-Global, n.d.). This marketing strategy brings the
volume of the customers up and by bringing the price down. “You might be tempted to
go crazy shopping the second the sale opens, but if you can be patient, you’ll find
discounts deepen as the sale nears its end,” advises (Dwyer, 2019). Women love the
feel of a new bra and Victoria’s Secret is not one to disappoint. By lowering the prices
and bringing in new/old customers, they are getting their brand out there for women to
fall in love with the feeling of confidence and comfort. That is the value to their
customers. Victoria’s Secret does an excellent job of providing a great product at an
increased price. Some of the new competitor’s have similar products in the same price
range because Victoria’s Secret has set the market for the luxury version of this
product. Because of selling half-sizes, ThirdLove now has over 75 million data points on
sizes, shapes, and the most common fit issues women face (Hanbury, 2018).
Expectation
Second reply demonstrates at least 2 of the following: knowledge of content,
connection with other student, and organized, clear, concise, and focused
writing.
=====================================================================================
A product that I continually go back to on a weekly bases would be coffee. Not just any
coffee though. Starbucks coffee in particular. Every week I go back to Starbucks for
some over-priced coffee that I know I could get somewhere else cheaper, or even make
myself if I’m feeling up to it.
One of the pricing strategies that immediately came to my mind when choosing my
product would be the skimming price strategy. “A strategy whereby a company sets a
high initial price for a product. The idea is to target buyers who are willing to pay a high
price ( top of the market ) and buy products early.” (Tanner and Raymond 2016) How
Starbucks uses this strategy would be its limited-time-only drinks. These are typically
drinks that are marked up in price and are only there for 6 or weeks at a time. For
example, their pumpkin spice latte is a well sought after drink that only comes around
once a year. With that being said, so are most of their other novelty drinks that come
around every 6 or so weeks. Using the skimming price strategy, Starbucks can set its
prices for these drinks high as costumers (especially regulars) are willing to pay.
Another strategy that Starbucks applies to its products is its odd-even pricing. Odd-even
pricing is more of a psychologically-based pricing method. It’s based on the idea that
some prices or price ranges are more appealing to its buyers. For example, Starbucks’
has its venti iced coffee priced at $2.95 instead of $3.00 giving a better appeal to its
consumers. Prestige pricing is also implemented by Starbucks as they set the costs of
their products higher to signal that it is of higher quality. Lastly, its implementation of
loyalty programs continues to bring its costumers back to buy more. Having the
Starbucks app means when you make a purchase and pay using their app, this gives
you a star for every dollar you spend. Firstly, you need to put money into your Starbucks
app to use, given you can only put 10 dollars minimum or a max of 100 dollars at a time.
Using the app creates a longevity effect in the sense that this process lengthens a
costumers value over time as they will continue to return to use their rewards, and gain
more rewards so that these stars do not go to waste.
Two of Starbucks’ biggest competitors are Mcdonalds and Dunkin’ Donuts. Though
both offer coffee at lower prices, they do not provide the same offerings as Starbucks
does. Though their pricing differs, with Starbucks you’re getting more than just a coffee
with the price that you’re paying. Howard Shultz (Starbucks Founder) put a lot of effort
in not just the coffee itself, but also to the entire buying experience. “Starbucks locations
around the world consistently have a good atmosphere, indirect lighting, relaxing music
in the background, great aromas, and friendly ‘baristas‘.”(Dada 2014) The ambiance
that Starbucks offers is one that reflects on its prices that does now with Mcdonalds and
Dunkin’ Donuts.
…
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