BMA5511



Channels And Pricing Strategy

This is a course that is meant for two important marketing mix variables, channel management and pricing. In Channel Management, not much attention is usually paid to understanding marketing channels in detail. In fact people used to call channels the `dark continent? of marketing, that is best left to `truckers?. But, is this true? One can make at least four observations: long term commitment of channel related decisions, existence of channel `power play,? market dynamics caused by channel changes, and the impact of internet on channel intermediaries. All these issues are very difficult to comprehend and solve if we do not understand `what channels are for?? Channel management is not just managing the retailers and the trucks and delivery personnel, but it is much larger than that. In Pricing, the one element of marketing strategy that is least understood and hence constantly feared by many managers is pricing. This is because pricing is a very complex issue. On one hand, it is supposed to reflect all the strategic steps the company has taken to bring the product to the consumer and convince him/her to buy it as well. On the other hand, it is supposed to reflect what the consumer would get out of the product by paying that price to acquire it. Will there be a match between the two? Perhaps and perhaps not. This dilemma makes it imperative for a manager needs to understand and analyze various factors in arriving at an appropriate pricing strategy. And, pricing does not operate in vacuum. It has to be married with other elements of the marketing strategy, including the channel management we discuss in this course. Thus, understanding the broader picture of the various elements of pricing, and building a scientific framework on pricing will always be reliable and better in the long run.

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