Pricing objectives

List price cap established by the Argentine government of Edelmiro Farrell in 1945.

Pricing objectives (or goals) is a term used in marketing and economics to provide direction to the whole pricing process.[1][2] This involves determining overall objectives that include the following: 1) the overall financial, marketing, and strategic objectives of the company; 2) the objectives of the product or brand; 3) consumer price elasticity and price points (the prevailing market condition); and 4) the resources available to the company.

## Common pricing objectives

Some of the more common pricing objectives are:

* maximize long-run profit
* maximize short-run profit
* increase sales volume (quantity)
* increase monetary sales
* increase market share
* obtain a target rate of return on investment (ROI)
* obtain a target rate of return on sales
* stabilize market or stabilize market price: an objective to stabilize price means that the marketing manager attempts to keep prices stable in the marketplace and to compete on non-price considerations. Stabilization of margin is basically a cost-plus approach in which the manager attempts to maintain the same margin regardless of changes in cost.
* company growth
* maintain price leadership
* desensitize customers to price
* discourage new entrants into the industry
* match competitors prices
* encourage the exit of marginal firms from the industry
* survival
* avoid government investigation or intervention
* obtain or maintain the loyalty and enthusiasm of distributors and other sales personnel
* enhance the image of the firm, brand, or product
* be perceived as “fair” by customers and potential customers
* create interest and excitement about a product
* discourage competitors from cutting prices
* use price to make the product “visible"
* help prepare for the sale of the business (harvesting)
* social, ethical, or ideological objectives

## References

1. ↑ Cant, M. C.; Jooste, C. J.; Strydom, J. W.; Plessis, P. J. du (2009). Marketing Management. Juta and Company Ltd. p. 338. ISBN 978-0-7021-7188-8.
2. ↑ Rao, Vithala R. (2009). Handbook of Pricing Research in Marketing. Cheltenham, Glos, U.K Northampton, Mass: Edward Elgar Publishing. p. 9. ISBN 978-1-84844-744-8.

## See also

* Price
* Price controls
* Price fixing
* Price gouging
* Just price
* Resale price maintenance
* Pricing
* Pricing strategies

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