Analyzing a Pricing Strategy Essay Example | Topics and Well Written Essays - 1250 words

Analyzing a Pricing Strategy - Essay Example The company chosen here for the pricing strategy analysis is â€Å"Givenchy† which is a world renowned firm for perfumes and luxury goods. This company has maintained its market value and product quality since years and their pricing strategy is well balanced with their customer demand and need. The customers are the life of any business and their needs and demands are evaluated by studying the market segmentation and their value attribution. The Company’s pricing strategy is entirely formulated with the aim of delivering highly qualitative products which can be identified as the status symbol of wealthy people. The company has different product line as perfumes, clothes, jewellery and other fashion accessories. The company has a phenomenal product value among the world wide consumers and for the very same reason it does not compromise much on its pricing. This is because the price of the product is which conveys the consumers about the value and quality of the product. Market segment is a sub set of consumer market, which caters to the profitability of a firm. A company creates value for a market segment by adding advantages and benefits to their products in accordance with customer tastes. Givenchy is an international firm which manufactures branded goods and luxury items and hence its customers are mainly aristocrats and wealthy population. Here the value for products is given by attributing quality and uniqueness to product they sell. This is because the wealthy consumers look primarily for a product which is of outstanding quality with extra – ordinary features. Givenchy being a renowned luxury brand creates value for their product in the international market by establishing their brand image, quality consistency and status symbol quotient. In order to create product value in their market segment, the company makes use of various endorsements, promotional offers, discounts and advertisement campaigns. The endorsement of Givenchy products are done by international celebrities who are considered as fashion icons and divas. This ensures the consumers that the Givenchy product lines are highly in vogue and have the characteristics of unique designer wear. Moreover, advertisement is considered as the potential means of creating brand image and value among market segments. Givenchy employs top rated models for their products launch and as their brand ambassadors. This delivers the consumers a message that the pr oduct is of exquisite standard and flamboyance. Additionally, the sophisticated company website and services offered, re-instates their product value and brand image among its consumers worldwide. 2. Does the company use different price offerings for different market segments? Describe these and evaluate how effective they are. A. â€Å"Givenchy† being an international brand has well planned strategies to absorb effectively into the global market. The pricing strategy of a company is based on a market research performed by the company in different market segments. A company keeps in mind, the demand for a particular product, competitor’s price, purchasing power of the customers and the good will of the product to formulate a viable pricing strategy for their products. Even though, Givenchy has wide market segments around the globe, there price offerings are