Business

Roles of Pricing and Advertising in Marketing Mix

Advertising in Marketing Mix

Most often, only a few firms compete with one another in the same target market. Economists call such a situation an oligopolistic situation. In this situation, many firms prefer increasing their share by increasing demand through advertising rather than reducing prices. 

The question that arises is – why do firms prefer such a strategy? The reason is that building up an image through advertising can be rocket science to match a price cut. 

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The assumption behind this preferred approach is that the firm can achieve a competitive edge in advertising and does not possess a large cost advantage over the competition to make price cutting an attractive pre-empting strategy.

Pricing Advertising in Marketing Mix

Price may be the main element in the marketing mix. Pricing should be carefully coordinated with decisions on product, promotion, and distribution.

For example, the luxury segments of consumer markets suggest quality, branded products, extra-touches, high-class outlets, appeals, and media that capture the luxury image and a high price to match. 

In conclusion, the objective of a marketer is to combine the various elements of the marketing mix viz. price, product, promotion, and distribution in such a way that the marketer will achieve the necessary volume of sales at a cost that will permit the marketer to make the desired profit. 

The way these elements are to be combined will basically depend on the target market. This means that the needs and wants of the target consumers have to be studied and interpreted and a unique blend of various elements of the marketing mix has to be designed to reach a specific group of consumers.

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