Pricing Strategies of SPF-65 Sunscreen Cream

This document discusses the pricing strategies for SPF-65 sunscreen cream, including premium pricing and competitive pricing. It also explores the type of market and re-pricing strategies. The document further delves into brand pricing strategy and price adjustment strategies. It discusses the types of channel partners and distribution methods, as well as retail opportunities and trends in the industry.

MANAGEMENT

1. Pricing strategies of SPF-65 sunscreen cream
While pricing SPF 65 sunscreen cream of Mehta Skin care that has been offered to the age
group of 22-40 years, it is important to consider that this product is offered to middle and
high-income level females that will help in pricing the product. Currently, SPF sunscreen has
become a need for the professional women, as it is likely to offer a level of protection to the
skin from the exposure of deliberate UV rays. An efficient pricing strategy helps in
determining the point price at which you can maximise profits. Some of the important pricing
strategies are pricing at premium, competitive pricing (pricing for market penetration),
economical pricing, price skimming, and bundle pricing (cost-based pricing). Premium
pricing set by the organisation is much higher than the competitor`s price. The main objective
of penetration strategies is to attract the buyers by offering low priced goods. For SPF-65
sunscreen cream, the pricing strategies will be chosen in the light of few reasons such as SPF
-65 is new in the market. As the segmentation considers middle and high level
income, quality is the most important factor that can satisfy them. The Mehta skin care
should use premium pricing for SPF-65 sunscreen cream. The Mehta skin care will offer its
product at higher price from its competitors. The pricing for different quantity tubes is below-
Quantity Pricing ($)
SPF-65 sunscreen cream (safe sun) 60 g 7
SPF-65 sunblock 150 g 10
SPF-65 daily safe multi-functional 200 g 13
Before paying for a product, a customer always look for the characteristics that the
product offers. SPF-65 will provide intense UVA and UVB protection, lightens the skin
tone, prevents sunburn and tan, reduce lines and wrinkles, and prevents pigmentation and
brown spots.
2. Type of market and re-pricing
Undoubtedly, SPF 65 sunscreen cream operates in a monopolistic market structure. The
pricing strategies also depend on the type of market in which the organisation works in.
Premium priced SPF-65 will be priced higher because of its unique branding approach that
ensures that it provides a competitive advantage for the manufacturer. SPF-65 sunscreen is
identified as luxurious and sophisticated as it is offered to middle and high-income level. For
repricing, monopolistic market is most feasible as the seller offers differentiated products. In
the scenario when the product “SPF-65 sunscreen” is offered to Amazon, Flip kart, EBay,
and shop clues, the concept of re-pricing is applied. For instance- elegance and highly
fashionable is priced much higher, high quality is priced high, exclusive product is priced at
very high price, and cheerful and cheap is priced at low price. This product keeps its own
brand value products that includes basic packaging, prices, and 25% below the major-brand
goods. In monopolistic market, a combination of premium and economy pricing is used for
SPF-65. While launching this new product, the company`s price adjustment is also known as
price protection, which is a retail practise in USA.

(Source: Toppr, 2019)
3. Brand pricing strategy
In order to establish a brand pricing strategy, Mehta skin care has to win trust among the
customers that can induce them to purchase the same product repeatedly and also promote
through word of mouth. To attract more customers, the company can provide a leverage to
regular customers that they can access the product even after partial refund of purchase price
especially when they can show it on sale even at a lower price in a fixed period (Compare the
cloud, 2018). Especially B2B, discounts is a common adjustment strategy that includes the
supply chain from manufacturer to wholesaler to retailer. The company will adjust the basic
price to reward its customers for the responses in such a way that early payment of bills and
off-season buying (Compare the cloud, 2018).
4. Price adjustment strategies
There are several price adjustment strategies such as dynamic pricing, geographical pricing,
promotional pricing, psychological pricing, segmented pricing, and international pricing.
Companies often adjust basic pricing so that it can allow some differences in products,
locations, and customers. In segmentation pricing, the company sells a product at distinct
prices in several segments even when price-difference is not only based on differences in
costs. Under customer, pricing, different customers pay distinct prices for the same product.
While determining the price adjustment strategy for SPF-65, it can be said that a combination
of psychological pricing and promotional pricing will be applied. As SPF-65 is offered to
working middle and high class where customer satisfaction is very much above than
economical.
For example- theatres and museums charge lower admission form senior citizen and students.
Another when it comes to ecommerce product pricing and pacing e-commerce sales,

considering each perspective can be beneficial. It has become mandatory to come up with
effective pricing strategy. In today`s high competition era, E-commerce pricing strategy can
make the product fly off the shelves and generate more profits. For instance- the company
can apply pricing tactics that is on the basis of certain prices that can have psychological
impact. It generally uses the emotion of the customers to encourage the sales. One of other
method of price adjustment strategy is psychological pricing which refers to pricing which
considers that the psychology of prices is not limited to economics (Pearson Canada, 2017a).
For example- by producing SP-65 of more quantity of around 500 g and offering them the
price of three digit number such as 999 rather than 4 digit “1000”, that would break the
mental barrier of paying in four digit number. Other pricing adjustment strategy such as
promotional pricing, which is used by the company to induce and grab their customers. For
instance- customers can judge the quality of the product by analysing and calling on the
experiences where price is less has low quality. Promotion calls for temporarily pricing
products, which is below its list pricing. The company often tries to create an excitement
regarding the buying urgency. As far as discount offering is considered, it is beneficial for the
company who wants to increase the sales. Promotional pricing can take various forms of
discounts lying between normal prices in order to increase the sales and at the same time,
reduce inventories (Pearson Canada, 2017b).
5. Types of channel partners
Some important channel partners for Mehta skin care includes its marketing channel,
intermediaries in the supply chain named as merchant wholesaler, distributor, advertisement
agencies, and retailers. It is important to create and channelize the reward program that can
ultimately lead to growth of profitability. Independent distributor, referral partners, and the
outside representative partners can sell SPF-65 sunscreen cream. Independent are either the
wholesaler or retailer of the product. Some wholesaler sell directly to the customers who buy
bulk amount. Referral partners are the employees of the company who helps Mehta skin care
to reach greater people that is vital to its success. Other representatives of the product are
customers and people who actually induce women to try to buy if they really feel it
comfortable.
6. Types of distribution
Channel of distribution is referred as a way through which manufacturer avail the product to
its customers. Below is the presentation of several channel, from the mentioned channels,
Mehta skin care uses indirect channel as its helps to diversify the business and reach more
people. The company would follow Manufacturer- Agent-wholesaler-retailer-customer.
Mehta skin care uses dual distribution such as it delegates its creams to wholesaler and
directly to retailers too. These agents are highly involved in distribution of producer’s goods
and they also get some benefits such as trip to hangout after achieving a target of promoting it
to a certain level.

(Source: Moneymatters, 2018)
Use of direct marketing channel will be enabled only by company`s workforce so that the
company can avail women “a trail” of the product. Most importantly, in indirect marketing,
there is risk of expiry dates and they might not pay attention to the dates and just sell the
product, which will affect the image of the company, not those indirect suppliers.
7. Ensuring channel partners
This type of marketing affects the profitability of the organisation as direct marketing cuts
down the expenses of third-party intermediary for more returns. Companies can directly
contact through channelization as cutting down the channel expenses by using technology
and internet services (Claessens, 2015). The usage of direct or indirect marketing channel is
given further. The company will use direct marketing channel through which it can use the e-
commerce and online platform to reach mass population. The company can use other
platforms such as programs, events, social media, hoarding, TV, and though radio. Special-
event pricing is to draw more customers that could be used to induce. In order to offer the
channel of offering, company will not use indirect marketing channels that would involve
intermediaries among the consumers and producers (Educba, 2019). This indirect channel
will be in form of vertical marketing system through which the company will use channel
structure directing from producers, retailers, and wholesalers as a unified system (Robins,
2016). Indirect marketing channel will use businesses channels in order to attract the diverse
customer pool but at the same time, the product is at the risk of duplication that will further
damage the brand image.
8. Types of retail opportunities
Several retail opportunities can be enjoyed by SPF-65 while expanding the operations. For
example- the company can expand its operation to different geographical areas according to
climate changes of that geographical area. It will also provide retail jobs and opportunities
such as human resources, marketing manager, logistics, visual merchandising, and accounting
for different outlets. The company can franchise its store of skin care w here the main
franchisee pay initial fees to franchisor so that other companies can use the trademark and
logo of the existing company. Channel partnership have changed in last few years as the
partner model focuses on resale, collection of upfront revenue, offers good technology,
strategic enablement and flexibility. Effective relationship between the channel partners can

affect and help to gain access to professional business tools so that it can reach out
(VnaAuken, 2013).
9. Retail trends and developments
While looking at the retailing trends and developments, it is seen that from all the options
such as experiential, in-store trial, gift cards, shopper`s marketing and social media
marketing. SPF-65 sunscreen cream should use the experiential that will help the organisation
to build trust among women. In order to induce and privilege the regular customers, the
company will use the facility of gift cards. The company should avail in-store trail facility
and check the skin after its regular use as the positive feedback will build a good image of the
company. Companies can form their website pages; promote their advertisements between
the YouTube channels. For instance- the company can directly contact Zipcar, NNetflix, and
Travelocity in order to employ direct marketing channel. Direct marketing channel will
analyse the needs of the customers, set the channel objective, and set the responsibility for the
channel members. In regards to decide the channels, the organisation will coordinate its
distribution management (Knowthis, 2019). The act of controlling the physical flow of goods
will include just-in-time logistics, so that customers can get access to its product as fast as
possible. This will reduce the cost of maintaining distribution centres and warehousing.

References
Toppr, (2019). Types of Market Structures. Retrieved from:
https://www.toppr.com/guides/business-economics/meaning-and-types-of-markets/types-of-
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Maguire, A. (2019). 6 Different Pricing Strategies: Which Is Right for Your Business?
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strategies-which-is-right-for-your-business/
Moneymatters, (2018) Types of Channels of Distribution. Retrieved from:
https://accountlearning.com/types-of-channels-of-distribution/
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from: https://www.comparethecloud.net/articles/the-importance-of-choosing-the-right-
channel-partner/
Claessens, M. (2015). PRICE ADJUSTMENT STRATEGIES – ADJUSTING PRICES FOR
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Educba, (2019). 10 Most Important Pricing Strategies in Marketing. Retrieved from:
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Pearson Canada, (2017a). Chapter 12 Retailing and Wholesaling. Retrieved from:
file:///C:/Users/System04099/Downloads/3181998_1027656941_chap12.pdf
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file:///C:/Users/System04099/Downloads/3181997_520757216_chap11.pdf
Pearson Canada, (2017c). Chapter 10 Pricing: Understanding and Capturing Customer Value.
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