A company’s (manufacturer) or product brand has intrinsic and intangible value. For example, what monetary value would you place upon the Nike Swoosh or the name Coca-Cola? These brands, these names, these trademarks are probably worth millions upon millions of dollars. As you are aware, companies invest considerable resources into maintaining the strength and position of their brand or brands.
Branding is important to both consumers and marketers. Branding helps the consumer to make decisions about which product to buy. Branding facilitates comparison shopping. Branding also gives the consumer some level of confidence regarding quality. From a marketer’s perspective, branding focuses the customer’s attention on a product’s benefits and advantages instead of competitive products. Branding provides a consolidated base for marketing strategies.
Amy's Candy Bar is a unique candy boutique, located in the Lincoln Square neighborhood of Chicago, where you will find a wide variety of candies and confections to tantalize your taste buds. Amy's carries everything from gummies, licorice, and chocolates to ice cream, malted milk balls, and Amy's signature sea salt caramels. In determining the pricing of her candies, Amy engaged in the 6-step price-setting process (click image to enlarge or click here for description
Giving careful thought at each step in the price-setting process increases the likelihood that the final price captures value for the firm and delivers value to the customer.
Sometimes, however, having the lowest price is the strategy. Distributor, generic, and store brands are gaining strength in the marketplace and are taking market share away from the company or manufacturer brands. In some cases, there may be very few differences between a manufacturer product and a store, private label, or generic product.
Discussion Topic
Think about what needs to be considered when pricing products as you watch the video: Sweet Business: Pricing at Amy'Candy BarLinks to an external site. (5:25). (Select "CC" for closed captions.)
Go to a supermarket, drug store, or discount store. If you cannot get to a brick-and-mortar store, you may try to do this assignment via the store’s website.
- Select one specific product. Identify the name-brand product and the generic version. If possible, take a photo or a screenshot of your products and add this to your post. This way, we can compare the visual impression of the two products as we follow along with your description.
- List and compare each product's characteristics and packaging.
- How were these items displayed?
- Discuss if there are any other ways for these brands to differentiate themselves aside from price.
- Identify the characteristics of the Target customer for the name brand and the Target customer for the generic brand. Contrast how both products meet each of these customers' needs.