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Dairy queen is in Minneapolis. It develops licenses and services. Dairy queen introduced blizzard in 1985. Blizzard is used during summer due to its coldness. It includes flavors such as Oreo cookies, mint Oreo, chocolate chip cookie dough, and seasonal flavors such as pompkin pie. It has been facing challenges such as customer dissatisfaction of their products and services, unavailability of their products whenever the customers need them and inability to match the price and the quality.
Daily queen has to analyze and change its pricing and distribution strategy to suit customer needs and expectations (Measured up, 2011). Effective pricing as a marketing strategy can be combined by other strategies in order to create a competitive advantage in marketing (West, 2010).
Pricing strategy is a process of finding optimum price levels by considering the overall objectives, consumer demand, product attributes, competitors’ price, and macroeconomic trends while distribution strategy is the coordination of products to the target market. It is the structures for distribution channels, patterns for the design, choices of distributors, and the factors affecting the choice and management of the channels of distribution (Kaminsky, 2003).
Dairy Queen Blizzard concerning pricing strategy
Dairy queen pricing strategy is a seasonal discount. Price reduction is during a given time of the year, for example, they will give seasonal discounts only from April 19-25th to celebrate their 25th birthday with 25 different flavors. This motivates and rewards customers. The satisfaction derived from the product attracts more customers. They use promotional pricing: this makes use of technical price reductions discounts, pay later, special offers, and vouchers.
Pricing based on the product purchase quantities. For instance, the organization could provide quantity discounts for large-scale purchase of the product. The strategy encourages large-scale purchase of the products of the company hence an increase in the revenue realized (Ferrel, 2008).
Dairy Queen Blizzard concerning distribution strategy
The owner of the Waren Burett asked court of California to change sales frozen desserts markets under a name similar to his, for example, in location analysis of their costs of examination of competitor pricing alternate by positioning. It uses e-distribution, and a variety of stores for example, Chicago store and other urban areas, and has a regional distribution manager at the international dairy queen.
Break-even analysis is a basic tool, used to calculate the minimum quantity of a product, sold in order to cover the costs of producing and delivering the product (Ferrel, 2008). The price range for the product is$3.2 (Measured up, 2011)
Appropriate pricing strategy
Value pricing: this sets the price of a commodity based on demand likely to improve market share. The price rises after gaining market share. Pricing based on the product purchase quantities. For instance, the organization could provide lower prices to discounts for large-scale purchase of the product. The strategy encourages large-scale purchase of the products of the company hence an increase in the revenue realized (Ferrel, 2008).
Basic financial operations need to be included in decisions made if the product provider is to operate profitably or survive in the market environment. Overall price strategy is influenced by the organizations objectives. However, certain factors will affect the actual pricing decisions and selection of appropriate pricing policies (Measured up, 2011).
Prices should not be set once but should be a continuous process that should always be open to adjustment when need arises. It is important for the organization to recognize problems that can arise from the failure or inadequacy of some pricing programs so that steps are to rectify the situation. All aspects of their market planning pricing continuous and correct actions implemented immediately. This will help improve satisfaction of their customers (Measured up, 2011). The key stages to use in their price decision-making include:
- Analysis of the organizational objectives in terms of pricing
- Determination of demand levels and customer characteristics
- Analysis of their costs
- Examination of competitor pricing and positioning
- Setting prices by utilizing pricing concepts.
- Monitor market response to price set and identify the problems (Ferrel, 2008).
They should use promotional pricing: this makes use of technical price reductions discounts, pay later, special offers, and vouchers. Pricing based on the product purchase quantities. For instance, the organization could provide quantity discounts for large-scale purchase of the product. The strategy encourages large-scale purchase of the products of the company hence an increase in the revenue realized (Ferrel, 2008).
Appropriate distribution strategy
They should increase their channels of distribution and efficient management of their channels to ensure their products are available when needed. Importance of this distribution strategy to the organization:
- It defines how the organization is going to create and satisfy the demand of its products.
- It facilitates efficient and cost-effective ways for movement of products from the producer to the consumer.
- It helps the organization to develop and maintain customer loyalty by providing products when customers need them.
- It determines the sync of customer shopping habits (Kaminsky, 2003).
Ferrel, O. (2008). Marketing strategy. New York, NY: Cengage Learning.
Kaminsky, P. (2003). Designing and managing the supply chain: concepts, strategies, and case studies. New York, NY: McGraw Hill Professional.
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Measured up. (2011). Dairy queen reviews and complaints. Retrieved from: web.
West, D. (2010). Strategic marketing: creating competitive advantage. New York, NY: Oxford University Press.