Group 1:

Kristine Lei Rey Stuart Jericho Lazo

Ma. Christine Macaoyam Ailyn Pacinos

Precious Jade Morales

Mina Eracris Macaranas

Cost Based Pricing Approach:

These pricing approaches are the simplest one in which the cost of product or service is added with a
certain proportion of markup as profit to ascertain a certain price. Examples include construction
businesses that estimate the cost of any project and submit their bid by adding a certain portion of
profit to their estimated cost. Moreover Accountants, Lawyers and other professionals charge a price of
their services by adding the cost of work with a certain proportion of markup.

Markup pricing is not regarded as an effective pricing model as it ignores both demand and the pricing
of competitors. Therefore, it is almost impossible for a business to keep its price as best one by adopting
this category of pricing. But still Cost based pricing is popular due to the following reasons.

It makes pricing simpler so the marketers do not change the price of their product or service with the
changing demand.

When the majority of businesses in the market adopt this pricing model, there would be minimum price
competition due to similarity in prices.

Generally cost based pricing looks fairer for both buyers and sellers as buyers are not exploited under
condition of higher demand and also the seller can earn a reasonable profit in such pricing.

Buyer Based Pricing Approach:

These pricing approaches is extensively applied by many organizations in which the perceived value of
buyer is regarded as a base for Setting Price for a product or service. In this pricing model the value of
product or service is perceived by customers that give the guideline for the price of that product or
service. In other words the price is not set after the production of product, but before the production.
This means that the organization considers the customers along with their perception about certain
product or service. On this basis, the business sets a certain price and then starts manufacturing that
product. The expected value and price provide guideline for the cost and design of the product so that it
can match the perceptions of the customers.
It is difficult for a business organization to ascertain the different perceived value by the customers on
different products. For this purpose these organizations conduct surveys and experiments. If a business
keeps the price of its product higher than the perceived value of customers, then its sales are affected.
On the other hand, if a business keeps its product’s price lower, then maybe its sales increase, but the
profit does not increase accordingly. Therefore, those organizations, which want to adopt this value-
based pricing strategy, should keep the price of their products in accordance with their perceived value
by customers. But more effective strategy is that the businesses should try to deliver more value to the
customers than they perceived in order to retain them as loyal customers.

Competition-Based Pricing Approach:

In this pricing model, businesses keep the price of their products or services on the basis of the prices of
their competitors. Also, customers in the market perceived value to any product or service in relation to
prices of similar products of competitors. So there is some sort of going rate pricing in which the prices
of products are altered according to changes in the prices of competitors. For example, steel or fertilizer
manufacturing businesses face oligopolistic competition in which they charge almost similar prices in the
market same like the competitors. There is a market leader whose price is followed by all other smaller
competitors. When the price of market leader is changed, other competitors in the market also adjust
their prices accordingly. Some smaller business may keep a slight difference in their price as compared
to the market leader, but this slight difference remains constant in different conditions.

There is one big advantage of adopting this ongoing rate of competition based pricing, which is the
prevention of price wars in the market among competitors.

Another form of competition, pricing model is sealed bid pricing in which the price of a job is raised by
keeping in view the prices set by competitors. In this case the pricing also ignores the cost and demand
factor, but the businesses try to keep their prices little higher than their cost in order to earn a revenue.
Pricing is not confined to only above categories rather there are other factors that affect the pricing
decision like environmental etc.
GROUP 2

Cayasa, Mark Manwell S. Imperial, Patricia Ann B. Parcon, Kristal Jane P

Bautista, Zien Johann O. Nakata, Miyuki F. Tinapay, Kristel B.

Bocalan, Michelle Dianne G. Oliveras, Marianne May

DISTRIBUTION CHANNEL

Distribution Channel

 A distribution channel is a chain of businesses or intermediaries through which a good or

service passes until it reaches the end consumer.
 The path by which all goods and services must travel to arrive at the intended consumer.

DISTRIBUTION CHANNEL FORMS

Direct form

- allows the consumer to buy the good from the manufacturer

Indirect form

-allows the consumer to buy the good from a wholesaler or retailer.

BREAKING DOWN!

Distribution channels can be short or long and depend on the amount of intermediaries
required to deliver a product or service.

However, goods and services sometimes pass to consumers through multiple channels —
a combination of short and long.

THREE TYPES OF DISTRIBUTION CHANNELS

First Channel Second Channel Third Channel

Producer Producer Producer

Wholesaler Retailer Consumer

Retailer Consumer

Consumer
EXAMPLES:

First Channel

The wine and adult beverage industry. In this industry, thanks to laws born out of
prohibition, a winery cannot sell directly to a retailer. It operates in the three-tier system,
meaning law requires the winery to first sell its product to a wholesaler who then sells to a
retailer. The retailer the sells the product to the end consumer.

Second Channel

Dell, for example, is large to sell its products directly to reputable retailers such as Best
Buy.

Third Channel

Amazon -using its own platform to sell Kindles to its customers, is an example of a direct
model.
GROUP 3: The Difference of Advertising and Sales Promotion
Members:
Castañares Fadrilan
Chua Poblete
Condez Rolle

Sales Promotion Advertising

 Direct  Indirect
 Creates immediate action  Cultivates long – term brand image
 Short Term Profits  Long Term Profits
 Encourage brand Switching  Encourages brand loyalty

Advertising vs Sales Promotion

Advertisement means spreading of

information
Promotion are commonly referred
The main purpose of every commercial
Is a method on announcing your product or
organization
services
Is to promote sales through communication
Example: using coupons, and celebrity to
Any activity of advertisement is called increase sales
activity of promotion
Moreover is using contests, rebates

Sales promotion includes activities which

All of this attracts customers
seek to directly induced and serves as
incentives Making them your patroners
To motivate is its expertise Seeing them satisfied is your mission
Advertising in its narrowest sense Consumer using your product is your vision
Is when you send message through the
internet, website, TV, radio or banners
All to attract to patroners
Group 4

Antiniolos Razel Digma Paulette Egualan Therrie

De Guzman Angelica Despe Emiel

PERSONAL SELLING

Personal selling is where businesses use people (the "sales force") to sell the product
after meeting face-to-face with the customer.

The sellers promote the product through their attitude, appearance and specialist
product knowledge. They aim to inform and encourage the customer to buy, or at least
trial the product.

A good example of personal selling is found in department stores on the perfume and
cosmetic counters. A customer can get advice on how to apply the product and can try
different products. Products with relatively high prices, or with complex features, are
often sold using personal selling. Great examples include cars, office equipment (e.g.
photocopiers) and many products that are sold by businesses to other industrial
customers.

The main advantages and disadvantages of personal selling can be summarised as

follows:

Point-of-sale merchandising can be said

to be a specialist form of personal selling.
POS merchandising involves face-to-face
contact between sales representatives of
producers and the retail trade. A
merchandiser will visit a range of suitable
retail premises in his/her area and
encourage the retailer to stock products
from a range. The visit also provides the
opportunity for the merchandiser to check
on stock levels and to check whether the
product is being displayed optimally.
GROUP 5

Aguirre, Justine Andrei L. Amboloto, Jalilah Logarto, Jonalyn L.

Fuerzas, Edgardo Jr. D. Cerbolles, Ma. Nicole L.

Mondragon, Irish Candido, Janine S.

Promotion (Public Relation)

PROMOTION

- Keeps the product in the mind of the customer and helps stimulate demand for the
product. Promotion involves on going advertising and publicity. Advertising, sales,
public relation are the on going activities that are considered in the aspect of promotion.
The target of promotion is to persuade its audience.
- It has five elements and these are;
1. Advertising
2. Public relation/Publicity
3. Sale Promotion
4. Direct Marketing
5. Personal Selling

ADVERTISING

- Advertising is bringing product or service to the potential current customers. It only focus
on one particular product or service.
- It is typically done with signs, brochures, commercials, direct mailings, etc..

PUBLIC RELATION/PUBLICITY

- It is strategic communication that builds mutually beneficial relationships between

organizations and their publics.
- Maintaining the reputation/public image of the company.
- The activities include in public relation is helping the public to understand the company
and its products.
- Public relations are conducted through social medi, such as newspapers, television and
magazines.
SALES PROMOTION

- Process of persuading customers to buy products. It is made to be used as a short-term

tactic to boost sales, it is rarely used as a method of building long-term customer loyalty.
- It is uses to promote an increase in sales, usage or trial of product to improve product
availability.
- There are a lot of methods in sales promotion and these are:
1. Money-off coupons - enables the customers to buy product next time at a reduced time.
2. Competitions – allow the customers to buy product to take the chance to win a prize.
3. Discount Vouchers – Like money off coupons, it is a ticket or document that can be
redeemed for financial discount when purchasing products.
4. Free Gifts – Free products when buy another product.
5. Point of sale materials – Uses posters or display strands to show to customers that the
product is there.
6. Loyalty cards – customers earn points for buying goods or shopping at a certain retailers
that can be later exchanged for money, goods or other offers.

DIRECT MARKETING

- Direct marketing is a type of advertising that uses variety of media as a channel to give
information about the company’s products or services, such as cellphones, email,
websites, online advertisement and they use it as a communication to their potential
customers.
- Form of advertising in which companies provide physical marketing materials to
consumers to communicate information about products or services.

PERSONAL SELLING

- Defined as a “Process of person to person communication” between salesperson and

customers.
- Business uses people (sales force) to sell product after meeting face to face with
customers. The products are promoting by the sellers through their attitude, appearance
and specialist product knowledge. They aim is to inform and encourage to buy or atleast
trial the product.
Group 6
Promotion Direct Marketing

Direct Marketing
Form of advertising in which companies provide physical
marketing materials to consumers to communicate
information about a product or service.