How Prices are Named

29-Jan-2023

HOW PRICES ARE NAMED

Pricing or Price is the key element in the traditional marketing mix (the 4Ps) and also the enhanced marketing mix (the 7 Ps). This is the element which earns revenue. This is highly critical because this is the strategy which can make or mar the business. The firms must make it both ways –the price must

(1) Get profits for the firm, and

(2) Give value to its customers.

For goods the price has a single name “Price”, but for services it has several names like:

·       Allowance          

·       Assessment      

·       Bribe                  

·       Brokerage

·       Commission      

·       Consideration   

·       Contribution      

·       Coupon Rate

·       Cut                      

·       Expenses          

·       Fare                    

·       Fees

·       Honorarium       

·       Interest              

·       Package            

·       Premium

·       Rate                   

·       Remuneration   

·       Rent                   

·       Retainer (Fee)

·       Salary                

·       Service Charge 

·       Subscription      

·       Tariff

·       Taxes                 

·       Ticket                 

·       Tip                      

·       Token

·       Toll                     

·       Tuition                

·       Wages               

·       Hair Cut

Pricing for goods is easy and straight forward, while for services it is complicated, may be controlled by several authorities, varies with time, place, people, etc.

[ Please visit my earlier Blog on 15-Jan-2022 on "Cost, Price & Value" here:

Himansu Sekhar's BLOG: January 2022 (hisema.blogspot.com) ]

 

Cost, Price & Value

15-Jan-2022: 

Cost, Price & Value: Explained in short in the Marketing parlance

Cost:

• The dictionary meanings are: the price paid to acquire, produce, accomplish, or maintain anything; an outlay or expenditure of money, time, labor, trouble, etc.
• Cost means a price that must be paid for something or a sacrifice.
• Cost most often refers to a specific amount of money that a seller wants for the item they are selling. However, cost is also used more generally to mean whatever the price of an item is.
• But in today’s world of Marketing, Cost is an objective term which generally refers to all types of expenses incurred to produce, procure, create or manufacture an item.
• Cost is of Objective nature. It remains constant under unchanged circumstances.

Price:

• The sum or amount of money or its equivalent for which anything is bought, sold, or offered for sale.
• Price is used mainly of single, concrete objects offered for sale; charge, of services:
• But in today’s world of Marketing, Price is an objective term which generally refers to Cost plus a margin amount which is called profit, which rewards the maker / producer / procurer / creator / manufacturer.
• Sometimes the Price may be less than the Cost under certain undesirable constraints.
• Price is of Objective nature. It may change on various different reasons for the same cost.

Value:

• Intrinsic worth, merit, or importance of an object;
• Monetary or material worth, as in commerce or trade.
• Value, worth imply intrinsic excellence or desirability.
• Value is that quality of anything which renders it desirable or useful:
• Value is of Subjective nature. It doesn’t change on its own.
• Sometimes the Value of an Object can be changed which is called the “Value Addition”, by undergoing certain processes.
• Value is sometimes divided into two types:
• Objective, Physical, Utility; which remains constant.
• Subjective, Emotional, Esteem; which varies from person to person, time to time, etc.