![]() According to the Principles and Practice of Marketing (David Jobber), Nike executes a rapid skimming pricing strategy of setting high prices in the products and investing heavily in promoting the newly designed products. After a newly designed product has been out in the market for a while, Nike lowers the price of those products. By implementing this strategy, Nike tries to skim money from the customers who want the product and are willing to purchase it at that price. When the company brings out new design products into the market, Nike uses this strategy to set high initial prices. Nike applies a price skimming type strategy whenever it produces expensive products especially which are limited editions. Nike sets this pricing strategy for the products which create a high level of brand loyalty and also for its leading-edge technology. And Nike’s premium pricing strategy drives its perceived value to a higher level especially with the limited editions of the Air Jordan’s. Once Nike develops its exclusive products, it becomes recognizable to consumers in the market place. The company owners and employees know that these prices will not only reflect the quality of their company’s products but also the image which will be portrayed by the consumers who wear the Nike logo. Nike applies the premium pricing strategy to make its products’ prices higher than the prices of the competitors based on product quality. With the help of this strategy, the company can determine its product prices, uses competitive prices, and set attractive prices for different market segments according to its market dominance. Therefore, the company can effectively practice the price leadership strategy. Nike is one of the leading players in the oligopolistic market which is related to the sports equipment industry. This strategy is suitable for an oligopolistic market environment and Nike runs its business in the oligopolistic market. This pricing strategy worked for Nike as it came to know about its product’s value amongst the customers and the company started to get profits and prices of its merchandise started to rise. This was Nike’s commendable idea to ask people how much they can pay for certain products. This strategy ascertains how much maximum price consumers are eager to pay for the company’s products such as sports apparel, sports shoes and equipment. ![]() Nike focuses on delivering the highest quality products at the right price to ensure the best customer experience whereas the other companies use the idea to sell products at the cheapest rate as it will generate more sales. Nike uses a value-based pricing strategy in order to set its prices according to the consumer perceptions about the value of the company’s products. In 2014, Nike implemented its new pricing strategy after determining from a market analysis that its customers appreciated the value that the brand provided.įew of Nike’s pricing strategies are being explained below. apparel industries dropped their prices and offered heavy promotional discounts. ![]() Nike was able to raise its price range while other U.S. Nike implements its pricing strategy based on the product’s understanding and determining which price point will be best for their products. There are different pricing strategies that Nike used effectively for expanding its branding all over the world. Avoid this type of sentences: directly talk about the data driven statements.
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