Question:
What do you mean by price? What are the objectives of pricing?
What do you mean by price? What are the objectives of pricing?
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Price = Value of product in monetary terms; Objectives of pricing = Profit, sales, market share, survival, customer satisfaction.
Updated On: Oct 6, 2025
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Solution and Explanation
Meaning of Price: Price is the amount of money charged by a seller from a buyer for a product or service. It represents the value that consumers are willing to pay and is a crucial element of the marketing mix.
Objectives of Pricing:
Profit Maximization: Setting prices to earn maximum profit.
Sales Maximization: Keeping prices low to increase sales volume.
Market Share Leadership: Competitive pricing to capture or retain market share.
Survival: Lowering prices in tough competition to sustain the business.
Customer Satisfaction: Reasonable pricing to attract and retain customers.
Product Image Building: Premium pricing to create a brand image of quality.
Return on Investment: Ensuring that pricing provides a fair return to investors.
Conclusion: Pricing is not only a revenue-generating tool but also a strategy to achieve business goals such as growth, survival, and goodwill.
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