BUSN Final Exam
Larry, the owner of a local lawn service company, is evaluating the various types of advertising media. Select four types of advertising media Larry should use, explaining in your own words why you feel these are the correct choices for him. Additionally, recommend a percentage of his advertising budget that should be allocated to each type of advertising. (15 points)
Since Larry is a local business owner I don’t think using television is the best route to go for his type of business. I think the 4 ways they he should advertise in the local community may be a little bit beyond is through the local newspaper, the radio, direct mail, and outdoor advertising.
Of these 4 the most important one would probably be radio followed by direct mail then in the local newspaper prior to outdoor advertising. I believe Larry should put about 45% of his budget towards the radio advertising. I say that because with this day and age not only do you have a local radio station, which also have Internet radio which reaches more people and it might be people from outside the area that may be moving to the area. The next place he should advertise is direct mail. I would put 30% of my advertising budget to direct mail since the company is a local business. The local area just may not know about his business but if he sends a postcard in the mail then that should help generate business. He should advertise 10% of his budget in the local newspaper. This is because people do read online paper as well as print papers but the numbers has gone down. The remaining 15% should go to outdoor advertising such as a billboard or on a bus or train if that is an option in the area.
Contrast skimming and penetration pricing strategies. What types of products or marketing situations best suit each strategy? Provide an example of products that use each pricing strategy. (15 points)
An example of a price skimming is HD TVs. Sony in Japan first introduced them in 1990. That TV fetched a whopping $43,000. Between 1990 and 1993 the price was reduced to about $6,000 for a 28 inch TV. In 2001 the price was even lower; a 40-inch TV cost only $2,000. At this price many more people were able to afford it. As we all know the TVs have come down even further in todays market.
Phone and cable companies have penetration prices all the time. Although it seems to be a discount pricing strategy in the beginning, once the price increases after the initial period the company hopes that you will stay. The pricing strategy then turns to a penetration type of strategy.
Learning experience in this course; and comments about Financial Statements Tutorial 1. Describe your learning experience for this entire course. What did you particularly