Pricing is the hardest task when launching a new product in the market. Although when you are a monopoly it becomes easier since you only require an understanding of the market and the preferences of the products.
The necessary strategies considered depend on the competitors and the nature of the market. For a new product, I would recommend penetration pricing and economy pricing. Since the product is new and it requires marketing strategy, pricing is one of the important tools of marketing that can be used to capture the attention of the buyers. The market is established by the forces of demand and supply. Therefore, for the market to have sufficient customers the product needs a penetration strategy. The strategy allows low pricing of the products than competitors so as to attract customers and to make people understand and learn about the product. Low pricing helps people to meet and save some costs they would incur when buying a similar product. The nature of the product would provide an alternative and customers would forego products of the competitors and opt for your prices. The assumption they make is that they can still get the same product at a cheaper price from another source.
Similarly, the economic strategy has dominated businesses in the world today. Many people would prefer to reduce the prices and sell more of the products. Therefore, the end result is a small profit which if accumulated over a short time may lead to supernormal profit. The strategy is a good strategy since it encourages the company to produce more products (Shkurupskaya, & Litovchenko, 2016). The resources available will be used efficiently and production will be continuous since there is a ready market for the products.
A new product requires much attention from the people directly involved in marketing. Distribution of the product should be one of such attention. The product needs to be readily available to the consumers so that they can gain confidence. The channels involved would be wholesalers, retailers, internet and the sales team. The product will be distributed to the wholesalers since they will act as intermediaries and ensure it reaches a wide market. The retailers will sell the product to the final consumers and this makes it one of the best distribution channels (Riaz, & Tanveer, 2012). To meet people globally, internet marketing takes the lead. In other words, the products are delivered as ordered ones they are made known and available. It is one of the cost-effective methods that will not require a lot of costs to run. Engaging the sales team is also a better option. The team will reach out to every person in the vicinity and let the person know that the product exists and deliver any other information that would be necessary (Njenga, 2016). Therefore, the distribution plan would be complete if the mentioned persons are engaged accordingly. The products will be made available to the customers and at a cheaper price if the strategies mentioned are put into practice. The sales volume is expected to rise and this would imply there is a good performance and expansion will be the end result.
In conclusion, penetration strategy is the best strategy one can adapt to enjoy the competitive advantage in the market. A business must adopt realistic targets and ensure they are achieved. The distribution channels must be ready to have the products readily available to the customers when required.
References
NJENGA, M. N. (2016). STRATEGIES ADOPTED FOR INTERNATIONALIZATION OF LARGE FAST MOVING CONSUMER GOODS MANUFACTURERS IN KENYA (Doctoral dissertation, UNIVERSITY OF NAIROBI).
Riaz, W., & Tanveer, A. (2012). Marketing mix, not branding. Asian Journal of Business and Management Sciences, 1(11), 43-52.
Shkurupskaya, I. A., & Litovchenko, I. L. (2016). Investigation of the influence of consumer behavior on the formation of integrated marketing communications. Научно-технические ведомости Санкт-Петербургского государственного политехнического университета. Экономические науки, (5 (251)).
