Maketing Research: Price and Distribution

In the marketing research, Doyle and Stern (2006) emphasized ‘Product’ ‘Price’ ‘Place’ (Distribution) and ‘Promotion’ as the four classical strategic elements of the marketing mix (4Ps). In Chinese market, to define the appreciate pricing and distribution can become the most important parts as the new products entering. It is not only related to the construction of enterprise products group on defination of pricing, but also determines size, speed of ROI(Return On Investment) and integral part of CF(cash flow) controls for the company (W.Jian, China, 2008). Moreover, to select the appropriate distribution strategy can be seen another important one, because this is related to how the customer can get the right products. Hudson (2008) cited Kotler’s (1984) definition of marketing that reflected the importance of distribution as a major aspect of marketing process presents: “The process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchange that satisfy individual customer and organizational objectives”. For the new skin care products, what is the best distribution channel? What is the best price for each product? To answer these questions can review the literature of marketing strategy.

2.2.1 Price

Price can sometimes be an indicator of quality; with a higher price indicating higher quality (Mowen & Minor, 1998; Siu & Wong, 2002). Most Chinese customers think a higher price attributes to the higher cost of quality control (Siu & Wong, 2002). Meanwhile, some are price sensitive, whereby a high prices may change customers to competitive brands (Mowen & Minor, 1998). Therefore, price can influence customer on a positive or negative.

Price is one of the m...

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...he price can assist them to select the acceptable one. Thus, to investigate the competitors’ price(benchmarking) and make the price of what customer being acceptable can be the important factor in this research.

Store location is another popular element to be used in sales. It can be forecasted retail stores, determined the optimal location and sales of the store (Clarkson et al., 1996; Smith & Sanchez, 2003). In fact, the size of the stores can be classified through investigating the affection on the customers with sociological and geographical factors (Wrigley, 1998; Meyer & Johnson, 1996; Rust & Donthu, 1995). In other words, not only considering the consumer purchasing behavior, but also analyzing between the size of distribution channel(s) and the location(s) when the researcher decide the distribution channel. That can assist customers to make better decision.