Marketing

Objective

Describe considerations when developing a pricing strategy for a product line

Assignment Overview

In this assignment, you will select a line of products, and describe the product line's pricing and product features. You speculate as to how they were developed, clearly identifying the different price points.

Deliverables

• A memo containing no more than 2 pages, plus an attached table & reference list. 
• As a form of business communication, memos should be single-spaced and professionally formatted.
• Use this memo template (Links to an external site.) from Purdue OWL as your example. There are additional resources about memos at the Purdue website should you need to refer to them. 
• Include your list or table (from Step 2) as an attachment to your memo.
• Include a list of resources consulted as an attachment to your memo. Use a consistent format for your references (e.g., APA). 

Good examples include hair care products, automobiles, iPods, smartphones, laptops, and the like. You want to select a product line that offers different products, such as basic, intermediate and "expert" versions, at different price points. Select a product line which has at least three products in the line. If there are more than 6 products in the line, then choose 6 products that represent the product line. 

Step 2 Summarize the product line & price strategy in a table, using this file. 

Create a table which describes the current product line, including specific features of each product and the price of each product. Use this template for your table, or a close facsimile. Keep in mind that this table should contain 3-6 actual, real-world products in the line. 

Step 3 Prepare a 1-2 page memo for the Chief Marketing Officer (CMO).

After creating your table, put yourself in the role of a newly hired marketer for the company. Imagine that one of your first tasks is to review the existing product line & pricing strategy. As part of your review, you will consider the following:  

1. Product Line. What gaps or redundancies do you see in the product line? If there are gaps, what are your ideas to fill or fix them? If there are no gaps, clearly identify why this is so. 
2. Pricing Strategy. Do you think that the current pricing strategy for the product line is sound? Why or why not? If it is not sound, clearly identify why this is so. 
3. Risks & Benefits. What might you gain or lose by adjusting your product line and/or pricing strategy? If you choose not to make adjustments, what might you gain or lose by making no changes? 

Use the questions as a guide and structure your memo appropriately. Include the table of products and prices as an attachment to your report. In addition, include an additional 1-page attachment which references materials consulted. Examples of things you might reference include company websites, press releases, or retail store prices. 

As a form of business communication, use an appropriate format and style. For instance, limited use of headers, bullet points, and/or images can be highly effective & is encouraged. Consider your audience (the CMO) when crafting your memo.