Pricing

                                                                  Pricing

Price comes in many forms and performs many functions. Price has been the major determinant of a consumer and this is majorly true to all the people on the planet. Price is an important factor n determining sales and profitability. Competition along with consumer behaviour have resulted in a market that is characterized by discounts and sales promotion. Internet has been a major cause of reversing the fixed price trend as the consumers can now discriminate between sellers. Instant price comparisons, naming the price and getting the product are one of the few things that Internet has changed in the pricing scenario.

Coming back to HONDA Stunner 125 CBF it is priced at a comparative price when put up with other bikes in its segment. The prices of bikes differ from state to state depending upon the road and sales tax of that particular state.

BIKE	PRICE
Stunner CBFi	73,563
Stunner CBF	61,199
Hero Honda Hunk	64,215
Bajaj Avenger	77,770

As is visible from the table, stunner 125 CBF  is at a very nominal price compared to other bikes in the segment. The CBFi model is higher placed as it comes with Anti-Braking System technology which no other bike offers.

According to Kotler there are several steps to fix a price of a brand :

·         Selecting the pricing objective : Stunner had a firm objective, to provide a racing bike which was safe and comfortable. They also had to make sure that they make profit from the price they have put up which result in returns. Also, the pricing should help in maximizing market share which is currently held by Bajaj. Stunner is not using market skimming technique as the price of the bike is constant over the years even though the sales have seen an increase.

·         Determining demand : Demand and pricing are inversely related as shown by a demand-supply curve. In case of prestige goods (bikes), if the bike is at a higher price it may lead to more demand as the consumer may think of it as a better quality product.

·         Estimating Costs : Demand sets a ceiling on the price the company can charge for its product. Honda sets the price of Stunner that covers its cost of producing, distributing and selling the product including a fair return.

·         Analyzing Competitor’s Costs, prices and offers : Honda before venturing into the heavy biking segment had to analyze the prices of Bajaj and Hero bikes as they had a bigger market share and bigger customer base. In order to make their own base, they either had to tell the consumers about a better product or to put up a price that is comparable to other bikes in the segment.