ABSTRACT
The study’s main goal is to look at the impact of pricing strategies on sales volume utilizing the Marketing Model Shop at Federal Polytechnic Ado-Ekiti as a case study. The study used a survey descriptive research design, and the researcher used convenience sampling to identify 36 participants who work in the Federal Polytechnic Ado-Marketing Ekiti’s Model Shop. The responder was given a self-structure questionnaire, of which thirty (30) were extracted and validated for the study. Simple percentages were used to examine the data, which was then presented in the form of frequencies and tables. Pricing strategy has an impact on the sales volume realized at FPA Marketing Model Shop, according to the study’s findings. Simple percentages were used to examine the data, which was then presented in the form of frequencies and tables. Pricing strategy has an impact on the sales volume realized at FPA Marketing Model Shop, according to the study’s findings. A successful pricing strategy frequently leads to increased sales volume. This results to a bigger profit margin for a firm like Marketing Model Shop, allowing it to compete more effectively in the market. Low sales volume is often the result of a poor price strategy, and this can be catastrophic for a company because it leads to customer unhappiness. As a result, the study suggests that FPA Marketing Model Shop concentrate on aggressive brand marketing in order to strengthen its brand’s position as the finest in the market.
CHAPTER ONE
INTRODUCTION
Background of the study
Today’s businesses are operating in one of the most competitive periods in history. The rise and fall of businesses, as well as the outright failure of some, imply that if organizations are not adequately managed and have a clear direction, organizational performance and, eventually, organizational sustainability will be jeopardized (Utaka, 2008). Furthermore, pricing strategy is an important part of a company’s management emphasis that can help or hurt its performance. As a result, it’s critical for firms to get their pricing strategies just right.
The price of a product is the sum of the values that customers exchange for the benefits of owning or utilizing that product or service (Bearden, Ingram & Lafforge, 2014). The amount of money or value exchanged for the possession or use of a good or service is referred to as the price (Kevin, Hartley & Rudelius, 2014). Furthermore, it can be defined as the value assigned to a product or service as a result of a complex combination of costs, research, and a thorough grasp of customers’ perceived value (Kelly & Willam, 2014). Pricing, according to Kotler & Armstrong (2008), is calculating the value that a client must supply in exchange for a product or service. Pricing is the process by which a company determines the price at which it will sell its goods and services, and it can be a part of a company’s marketing strategy (Dibb, Simkin, Pride & Ferrell, 2013). Furthermore, pricing is the sum of all the values that buyers give up in order to get the benefits of owning or utilizing a thing; it is the amount of money charged for an item or service (Kotler, Armstong & Tait, 2001). Pricing is one of the most important aspects of a marketing strategy, which is part of a larger business plan (Rao & Kartono, 2009). The primary goal of pricing is to pay overhead expenditures, such as labor and materials, while also generating sufficient profits to support corporate growth and ensure organizational sustainability (Nikoomaram & Jafari, 2011). According to Yeoman (2011), one of the most important aspects of the marketing mix that businesses can influence is price. According to Agwu and Carter (2014), price is the only income generator among the famous four Ps because it is the only element that generates a value exchange. Effective pricing is the harvest, according to Kellogg, Youngdahl, and Bowen (2014), if effective product development, promotion, and distribution sow the seeds of economic success. As a result, pricing strategies tailored to specific products and services, as well as client perceptions of the value of the product or service, are required. As a result, pricing methods entail the use of a certain type of price information to reflect price evolution in price index compilation (Mckenzie, 2015). A price strategy is also targeted at identified clientele as well as competitors (Nreick, 2012).
Pricing plans are chosen based on the company’s and financial objectives. Pricing strategy decisions can also be influenced by elements of a company’s business plan (such as the company’s vision and goal).
The price a product is given has an impact on the consumer’s impression of it and, as a result, on their willingness to buy it. The importance of price as a buy stimulus plays a vital role in pricing management, according to Rosa & Rodan (2011), because it not only determines how prices are seen and evaluated, but it also influences consumer purchasing decisions. Price has been demonstrated in studies to be a key influence in buying decisions, particularly for frequently purchased products, influencing store, product, and brand selections (Simons, 2014; Rosa, 2011; Vanhuele & Dreze, 2012; Rondan, 2014). Furthermore, according to Roth (2007), price can be used as a market segmentation strategy because it can separate a product from its competitors. However, a product’s price must be consistent with other marketing methods and its qualities.
Statement of the problem
The business climate is rapidly changing from one in which firms have complete control over the types of products and services produced to one in which consumers have complete control over what they want produced. As a result, in today’s world, where business rivalry is fierce and consumers have a plethora of options, it’s critical for any firm hoping to maximize profit to get its pricing strategy correct. Due to their failure to generate bigger sales volume, many are unable to realize decent profit margins, dispose of excess stock, recoup the cost of operation on time, and command a reasonable market share; this is primarily due to the pricing strategy they utilize.
Objective of the Study
The overall goal of this research is to look into the impact of pricing strategies on sales volume ( A Case Study FPA Marketing Model Shop). The study’s objectives are as follows:
To see if price skimming has a negative impact on client retention.
To see if the firm’s penetration strategy has an impact on its market share.
To see if market parity price affects sales volume significantly.
Research questions
The goal of the study will be to find answers to the following questions. They are as follows:
Is there a link between price skimming and client retention?
Does the firm’s market share change as a result of its penetration strategy?
Is there a major influence of market parity pricing on sales volume?
Significance of the study
This research will have a substantial impact on manufacturing industry management. since it will assist them in comprehending the significance of pricing strategies in growing sales revenue, profit, and, eventually, their company’s success. It will also be crucial in determining the best pricing approach for each product type. The study will theoretically add to the body of knowledge and act as a reference for researchers and students interested in conducting future research in a connected topic.
Scope of the study
The study’s focus is on the impact of price tactics on sales volume. The study will also go on price skimming and how it affects customer retention, as well as penetration strategy and how it affects a company’s market share. Determine whether market parity pricing has a substantial effect on sales volume. However, the research is limited to the Marketing Model Shop in Federal Polytechnic Ado-Ekiti (FPA).
Limitation of the study
A few factors contributed to the study’s limitations. These are the financial and time constraints.
Financial constraints– A lack of funds impedes the researcher’s efficiency in locating relevant materials, literature, or information, as well as in the data gathering procedure (internet, questionnaire and interview).
Time constraint– The researcher will be working on this subject while also doing other academic tasks. As a result, the amount of time spent on research will be reduced.
Definition of terms
The price of a product or service is the amount of money charged for it. It’s the total of all the values that customers forego in exchange for the advantages of owning or utilizing a product or service (Kotler & Arsmtrong, 2008).
The study of individuals, groups, or organizations and the processes they use to select, secure, utilize, and dispose of products, services, experiences, or ideas to meet wants, as well as the effects these processes have on the consumer and society (Perner, 2016).
The marketing mix is a collection of controllable elements that a company can utilize to affect a customer’s response. (Kotler & Armstrong, 2010) (Kotler & Armstrong, 2010) (Kotler & Armstrong
Leave a Comment