Marketing Plan for Pizza Restaurant Targeted to a Rich Clientele - Essay Example

The customers of Pizza Restaurant spend money in purchasing its products and services from consideration of lifestyles and cultures. Therefore the changes in prices are less important in the customers’ minds.

Since customers go to Pizza Restaurants for quality, changes in prices are not that important to them. Therefore the price elasticity of demand is not important in this case. Demand for the products and services would be influenced to a minimal extent by price. The company is located in a rich city where the customers are richer than the customers in other parts of the country. Therefore the most influential demand factors are lifestyles and cultural considerations (Kotler and Keller, 2006, p. 65). The demand would be more influenced by price if the customers came to the company to get lower prices.

However, they purchase the products and services because the products and services deliver quality taste. 60% of the customers are from rich families who will be more concerned about the quality. Therefore demand in this case will not be affected by price to any great extent. Answer to Question 2 The unique selling proposition is the quality of products and services. Therefore the recommended pricing strategy is premium pricing. This will ensure a favorable perception among the customers (Armstrong and Kotler, 2005, p. 34). In this case, it is recommended that the management should maintain high prices to maintain the brand reputation which is the source of its unique selling proposition.

Since the customers have high expectations about the products and services, they will expect high prices as well. If the prices are reduced, then the customers might start to think that the products and services do not have the expected level of quality (Fred, 2006, p. 76). Pizza Restaurant is promoting a brand reputation based upon a unique selling proposition of unique qualities. This means that Pizza Restaurant will be offering products and services that are not available in the rest of the industry.

In this manner, the products and services are differentiated so that the customers can be diverted from rival products. To maintain the effectiveness of this differentiation strategy, the management should set high prices that will identify the products and services with premium quality. Moreover, most of the customers are from rich families who will be able to afford high prices. Therefore premium pricing is recommended for maximizing the sales rate. Answer to question 3 Price skimming will enable the management to maintain both the quality perception and the demand (Goetsch and Davis, 2003, p. 33). Because most of the customers are from rich families, they will be able to afford high prices.

Skimming tactics involve setting high prices for unique products and services. Pizza Restaurant’s products and services offer leisure and entertainment to rich customers. The uniqueness of the products and services is the basis of the unique selling proposition. In this situation price skimming will ensure high demand. Therefore setting high prices in keeping with the tactics of price skimming is recommended.

Price skimming will lead to a customer relationship management framework that is more strategically aligned. Since the unique selling proposition is promoting the uniqueness of the products and services in terms of ensuring excellent quality of taste and customer satisfaction, the effective pricing tactics would be to set higher prices which will maintain this positioning. Therefore price skimming is recommended.