The costs associated with higher product quality, satisfaction warranty, packaging, and marketing are investments the company can utilize to expand the market exposure. These changes equate to additional costs to the company. These costs will need to be considered in final product pricing as the company moves forward. The new branding and eventual brand identification will reap long-term results.
According to Roth(2007), various pricing strategies should be used at different times to allow for changes in company developed marketing strategies, market conditions and the life cycle of the product. Therefore it is imperative that Larson understand that results will take many years and multiple revisions as the product costs and consumer perceived values is revisited and re-evaluated frequently.
An understanding of supply and demand will support the decisions for the successful pricing strategy. Pricing the product too high may reduce the demand as fewer purchases are made. Too low of a price can increase volume of sales but may reduce margins profit.
The marketing plan will need to be revisited regularly to ensure the path forward is resulting in profits. Re-evaluationof this plan will result in consumer data on product reliability, dependability and value of the product. As the consumer satisfaction and perceived value continues to grow, an evaluation of the pricing structure needs to take place. Current economic conditions will weigh heavily on product pricing, however the intent is the perceived value will allow the batteries to become value priced. Consumers will become a committed customer and purchase the product based upon reputation.
Roth, S.A. (2007). Understanding pricing objectives and strategies: For the value-added ag producer. Downloaded on November 24, 2009 from http://pubs.cas.psu.edu/FreePubs/pdfs/ua441.pdf