Purpose and OverviewPricing Strategies is a very important part in selling and marketing a product to a target market for the selected product.
In this report it outlines the the external opportunities and threats, internal strengths and weaknesses, and assumptions of Miracle Shield firm. Marketing strategies are based on the SWOT’s of firms to help capitalize on strengths, exploit opportunities and help overcome weakness along with ways to avoid any threats. Miracle shield should be proactive when it comes to pricing strategies. This will help them avoid some of those internal and externals threats to the firm.
This will be understood why it’s so important later in the report. The report will also focus on how knowing the value of our product is very important and letting our customers know the benefits they will be receiving from it. Miracle shield has lots of value, as that is a internal strength that needs to be advertised to our customers. This report is going to give you a good understand on how to better your marketing strategies. Summary of Past and Current SituationsThe automotive industry is a huge part of the economy in the United States. This is what has built the automotive detailing/cleaning market. There is a increasing amount of demand as the number of cars on the road increase, along with the average age of vehicles is on the rise. Miracle Shield is in a perfect market that is looking good for the future.
As the number of people detailing their cars at home increase the demand for Miracle shields product will increase. The firm offers a innovative multipurpose product that removes the oxidation and shines the car’s surface in one-step. With a product that also protects and maintains the shine of a car’s finish at least 20% longer than regular car wax. The firm does face challenges that can affect the firms performance. With the industry on the rise, this will attract more competitors in the market. Being able to stand out from your competitors is very important. Miracle shield will be faced with the challenge earning customers by introducing them to the value of their product. This will cause the firm to introduce pricing strategies and tactics to counter balance those challenges Miracle Shield will be facing.
Using SWOT analysis it outlines weakness, strength, opportunities both internal and external. In the report below you will see the SWOT analysis outlined with some statements in bold font that concern the strategy focus of the report. External OpportunitiesThe United States has the second largest market for Automotive production and sales.Research show the automotive detailing industry contribution to GDP will rise at an average annual rate of 3.2% to 2019 (Yee, 2015).The industry is attracting more consumers detailing their vehicles on their own. Less demand for professionals. More young adults starting their own detail service with the increase in detailing products.
The average age of vehicles on the road is on the rise.External ThreatsIf the economy would takes a hit and would cause a decrease in the market, less demand for detailing products.If larger competitors try to take over the market, by buying out brands taking control of the industry.Technology advances that would regulate the chemicals allowed in one’s product. Chemicals that my be part of the ingredients found in Miracle Shields Auto Finish product. Internal Strengths Product protects and maintains the shine of a car’s finish at least 20% longer than regular car wax.
Miracle shield removes both oxidation and provides a shiny Wax in one application.Our product is the only alternative to car wax that is provided in the market. Our Miracle shield saves customers time and money, by fulfilling “two needs with one deed”.Internal WeaknessesMiracle shield is only provided in a bottle that is good for one application to one car.The price of our product is 25% higher than our competitors car wax.
We are not one of the top brands, compared to our major competitors having brand loyalty.Miracle shield is new to the market, we only have one product developed.Our advertising is not up to par with our competitors, as we have limited funds.
AssumptionsThe firms technology has provided safe chemicals and will not have to change their product.The price of Miracle shield will increase by 5%, as people will be willing to pay.Company called Quick shine will enter the market as a competitor. Miracle shield will increase their advertising across the media in the next year, showing the value.Pricing StrategiesThere is a number of influences that will affect pricing strategies for a product. The key is find the right strategy that gives one’s company the best profitability. Strategic pricing will take into account the ability of what consumers are willing to pay.
Strategic pricing also requires there to be trade off between price, volume and profitability (Economic). Miracle shield should be proactive when it comes to pricing strategies. With the external threats with competitors and technology changes that we may be facing, it will help us be proactive if disruptive events were to occur.
It will allow miracle shield to develop strategies in advance to solve issues (Nagle, 2002). We can be proactive by continue to research and survey our target market in segments. This will allow us to gather information that will help us find a trend in the market to help us stay proactive. It’s important to understand our products value, “commonly refers to the overall satisfaction that a customer receives from using a product or service offering.
Psychological value is a value Miracle shield gives its customers and it creates innate satisfaction. Economists call this use value—the utility gained from the product”(Nagle, 2002). This is something we have but, need to make sure our customers understand the value in our product. One of our Internal strengths is the fact, our product last at least 20% longer than any other car wax. This is a value in our product that can satisfy customers by insurring them, their car/truck will be protected with a higher quality paint protectant that last longer.
Some customers are unwilling to pay more for something new thats on the market, but over time promoting the value our product has, will lead to customers recognizing those valued benefits. This can be done by improving our advertising the outline and focuses on the quality and value. Having a product that offers more than just a regular car wax and doesn’t have a single alternate product on the market. This can make it hard to set a price Miracle shield, as it offers 2 or more products in one step. This can make it difficult to establish a competitive reference price. With our product you will only have to buy one bottle to take care of oxidation and provides a protectant shine. There is no need to buy both wax and a oxidation cleaner.
We will need to collect price data that is comparable to our product. “Competitive prices are measured in terms familiar to customers in the segment”(Nagle, 2002). Understanding this we can competitively price our product based on the time it takes to apply the product. This can help us better adjust internal weakness of our product costing 25% more.We may not have to adjust our price, but it is a good way to show our customers why the price is more than other products.
Summary and Request for Action Breaking down Miracle Shield by knowing the, external opportunities and threats, internal strengths and weaknesses, and assumptions provides insight on strategies and tactic are needed. The report broke down the company by the SWOT analysis, which allowed strategies to be implemented to help the firm. By implementing the strategies that have been outlined will help Miracle shield be more successful. Being proactive will allow miracle shield to develop strategies in advance to solve issues before external or internal threats may happen.
Knowing your product has value and showing it has value is two different things. Showing your customers the value and benefits your product has over competitors will give the satisfaction and willingness to pay for your product. Establish a competitive reference price can be a challenge, but is something I highly recommend you focus on to set your price. All of these strategies and tactics are things the firm can do and should implement if you want the firm to be successful in the market for years to come.