Important Pricing Methods in 4P’s

The main objective of this article is to describe the importance of relationship of various components of pricing methods for attaining competitive advantage in market. Pricing methods comprise of Product pricing methods and Service pricing methods. Generally the Product pricing methods consist of product, price, place and promotion and it is generally used for pricing methods of tangible goods. However Service pricing methods are related to three different variables for example people, process and physical evidence .In our economy; price influences the allocation of resources. In companies, price is one significant factor in attaining high market share. Main pricing objectives are, profit maximization, high market share, to attain status quo by stable price and meeting competition in the market. There are four major methodsfor price determination, i.e. (1) Cost based pricing, (2) Break-Even Concept (3) Demand based pricing and 4) Pricing related to market. Price setting is influenced by market conditions. The pricing methods involves the decisions related to which the products will be made available at a particular price, may be different price will be charged for the same product as per different market. Mostly pricing methods changes as per marketing conditions and also with changing environmental factors.