The Pricing Strategy

Pricing is the value added to a particular product or service. It is done depending on the total cost that the company uses for a product’s manufacturing, distribution, promotion, advertising and sales of a product.

Pricing structures for the product are also decided depending on external factors such as inflation, competitor’s prices etc. Out of the four Ps of the marketing mix, price is the only revenue generating element.

The consumer looks for the value that the product is giving him, and is ready to pay the amount for it, accordingly. The customer’s basic motivation to purchase a product comes from a need and then a want.

The need – I need a health biscuit to satiate my hunger.

The want – I need to have Sunfeast Farmlite Biscuits.

The factors which determine the effect of pricing on consumer buying decision are -

· Standard of Living
· Competition Price
· Income


For the manufacturer, the price is the only revenue generating element of the 4Ps, which makes it essential to price the product aptly. For most FMCG products, the following are taken into account while pricing a product –

· The cost of manufacturing
· The situation in the market (Recession/ Boom etc)
· The price of competitive products
· Quality of the product.


The price of Sunfeast Farmlite Biscuits is Rs.50 for a pack of 150gms. This product is competitively priced because the market is growing and competitors are also offering health biscuits at similar prices. 

Britannia is offering its Oats biscuit at Rs.55 and Mcvities is offering its Oats Cookies at Rs. 38. Setting a price which lies between its two direct competitors could be a strategy used by Sunfeast