Page 217 - GLOBAL STRATEGIC MARKETING

consideration. Many organisations need to be seen as socially
responsible, especially in developed economies. There is global concern

and summits to determine agreements on the levels of pollution, the
impact of production and consumption on the environment and the need
for governments and businesses to be sustainable and consider the

impact of globalisation on our planet. This can also be used as a unique
selling point to establish differentiation in the market place and in the

minds of the consumer. The influences on pricing decisions include the
distinctiveness of the product, perceived quality as well as taking into
consideration competitor strategies. This needs to be reflected upon when

determining the price for different markets.

9.10 Price differentials

Many organisations make the decision to offer differential pricing across
national boundaries. For example, GAP clothing is much cheaper in its

home market (US) compared to the UK (international market). This
decision can only be successful if the consumer is willing to the pay the
inflated prices in the international market. On the other hand some

companies price their products lower in the international market compared
to the domestic market. Similar pricing across markets (standardisation) is

a risky strategy and careful consideration needs to be made. Countries
may have different levels of economic development and consumers
maybe more price sensitive in one market over the other. However, when

Nike entered China, the pricing strategy of basketball shoes (higher than
in the US and UK) was successful because Chinese consumers perceived

value in the exchange (status) and a higher pricing strategy was
acceptable. However, consumers can be aware of price differentials,
especially through parallel importing and seek out products through

‘unofficial’ channels and get the product at a much cheaper price. This
undermines the pricing strategy of many brands but consumers are more

marketing savvy these days and can either buy quality counterfeits or find
the product cheaper elsewhere. Currency fluctuations can also bring about
changes to prices and impact upon exports and imports. Whatever pricing

strategy is adopted, it is clear that the company, product, market and