Week 14 - April 25, 2012

I can't believe the semester is almost over. I'm excited and sad. I've gotten used to my classes. This week we covered chapter 18, "Setting the Right Price." Price is the last of the four p's, Product, Price, Position, Promotion, that we will be covering. This is actually the last week of class. The final is on the 5th of May. I'm sorry I'm so late writing and posting this.

In class we reviewed or went over a few things for the final next week. I like this quote that I wrote down in class "best price usually falls between "expensive" and "prohibitively expensive." Our video discussion was on Acid-All and the case study was on Cable Television pricing. I'm not sure whether I like the idea of customizing what channels we pay for or not. There are positives and negatives to both sides of having customized plans/channels or not.

The process for setting a price is really more complex than I thought. There "is a four-step process: 1. Establish pricing goals. 2. Estimate demand, cost, and profits. 3. Choose a price strategy to help determine a base price. 4. Fine-tune the base price with pricing tactics." There are a lot of definitions in this chapter. One of which confused me. I learned this week that I need to be more flexible with my understanding of definitions. It's hard because sometimes things can seem so specific and other times they are not. I found the example of Chanel destroying their unsold merchandise inventory to be surprising. It seems to me to be such a waste, yet it fits their price strategy of price skimming. "Price Skimming a pricing policy whereby a firm charges a high introductory price, often coupled with heavy promotion." So they destroy the merchandise so they can keep prices high.

The chapter also discussed the legality and ethics of price strategy. It seems to me that some of these unfair trade practices are still being used even though they shouldn't, or at least I'm remembering seeing them or hearing of them before. The chapter also mentions "tactics for fine-tuning the base price." Base price is the definition I  got confused on and I feel bad about it.... I think I've seen some good examples of price-bundling. "Price bundling [is] marketing two or more products in a single package for a special price." Microsoft recently did this in bundling it's Kinect for the Xbox with a couple of game codes. My Dad and I actually went to Walmart on Black Friday for the deal, it was a mad house and not worth it. I had called Walmart a few hours previously to find out how many they had and they wouldn't tell me. Even though when I got there they had only had like ten, all of which were sold out to people lining up before like nine o' clock. We ended up getting the same bundle deal online when we got home, it would have been cheaper to look online at Newegg in the first place. I think one of the keys to bundling is to look at the price of the individual parts of the bundle, that might help with knowing whether you are getting a good deal or not. But pricing is definitely trickier than I thought it was. Pricing can also change "during difficult economic times." I found the picture of a dollar bill covered with bandages to be funny.

Overall, I think this was a pretty good chapter and an interesting class. I learned a lot more than I thought I would. Having had this class I think I will look at advertising, marketing, prices, etc. more closely. If I ever do start my own business, I think I now have some basic knowledge that I could use to market my business. In the least I could probably marketing my self, through such tools as personal selling when looking for a job.

Week 13 - April 18, 2012

Before Class:

Tonight we are covering chapter 16, Sales Promotion and Personal Selling.

I can't believe it. I'm caught up on my blog posting. It feels good. I'm sorry I've been behind. I hope I have some good stories to post after class tonight. So far, I like how the case study article was partially mentioned, if only in topic, in the chapter. That was a nice change and helped me tie things together.

Class:

We watched a video on YouTube called "Social Media Revolution". I've seen videos like that in at least one of my other classes before. We talked a bit about the final and what is going on with that as it is coming up. We watched a clip from the family man to help us understand and recognize personal selling. We watched another video clip about Vans and our case discussion was about Ron Popeil. I'm kind of surprised, I know some of the key advertising terms he used such as "But wait there's more," but I don't really remember him. Maybe I was too little or something. I thought of Billy Mays and some of those commercials when we were discussing the case.

I like my response to the class involvement quiz that covered this week of class. Granted I answered it on the 25th, but I like it. It is based on a question about personal selling being headed for extinction:

No I don't think personal selling is headed for extinction. It's important. What caused me to choose the digital camera I chose, granted this is at least a little over a year ago now, was the sales person telling me his experience. I probably would have paid the more expensive price at that store if they had had it in. I ended up buying the camera he recommended from another store and I still love it. It is great for taking pictures and even the low quality video isn't too bad, it's better than nothing.
Also, personal selling can be applied to other aspects. Such as selling yourself to a company, boss, new product ideas etc. We like to be involved and there are so many different products out there. How do you think those cute kids doing fundraisers manage to sell you a bit more than were originally planning to?(I used to do well at school fundraisers). They probably do a bit of personal selling with small talk and being cute...showing their personality etc. No I don't think personal selling is headed for extinction. In fact it is probably growing with how competitive things can be.

This was an interesting chapter. When it talked about the fact that manufacturers like rebates, according to the text"because the purchaser must mail in a rebate form and usually some proof of purchase, the reward is not as immediate" and later says, "The Federal Trade Commission estimates that only half of consumers eligible for rebates collect them." This has had me thinking about some of the things I could have done for rebates. For example the rebate we could have used when we bought my graphing calculator, but never got to using it. I think some of that could also apply to sweepstakes and contests, also "tools for consumer sales promotion". I've gotten receipts back with a URL to go take a quiz and enter for a chance to win a gift card, one that I really wanted to do recently had the contest/sweepstakes end before I could or remember to get to it. It makes me wonder how many people actually enter those contests. I also found it interesting that a Happy Meal toy is a premium "an extra item offered to the consumer, usually in exchange for some proof that the promoted products has been purchased." Yet it also makes sense. How many times did I beg my parents to buy an extra Happy Meal so I could get another Beanie Baby? Or an extra Burger King Kids Meal so I could get another Pokemon Toy. There are other examples of this too. Point is, premiums really can work. As do others tools for consumer and trade sales promotion.

I guess I had more to say than I thought I did.