(a) List two pricing strategies in marketing. (b) State four attributes of a product brand. (c) Explain five importance of price to a producer.

Answer Details

(a) Two pricing strategies in marketing

1. Market penetration pricing: Setting a low initial price to attract many buyers quickly and capture a large market share.
2. Price (market) skimming: Setting a high initial price for a new or unique product to earn maximum profit from customers willing to pay more, then lowering it later.

Other acceptable strategies: cost-plus pricing, competitive pricing, and psychological pricing.

(b) Four attributes of a product brand

1. It has a name, term, sign or symbol that identifies the product.
2. It distinguishes the product from those of competitors.
3. It can be protected legally through registration as a trademark.
4. It conveys a particular quality, value or image to customers and builds loyalty.

Other acceptable attributes: it should be easy to remember and pronounce, and it should be suitable for use in advertising and packaging.

(c) Five importance of price to a producer

1. Determines revenue and profit: Price directly affects the total income and profit the producer earns from sales.
2. Covers cost of production: A well-set price ensures the producer recovers costs of raw materials, labour and overheads.
3. Competitive tool: Price helps the producer compete with rival firms and win customers.
4. Influences demand and sales volume: The price set affects how much of the product customers will buy.
5. Reflects product image and quality: Price can position the product as premium or economy, shaping how customers perceive it.

Other acceptable point: price guides production and investment decisions.