Pricing

In general terms pricing is the process of determining what a company will receive in exchange for its products. Pricing factors are manufacturing cost, market places, competition marker condition and quality of product. Pricing is the revenue generating element amongst the four P's of the marketing. Price is considered as the major determinant of the buyer’s choice weather to buy a product or not. In recent time pricing strategy has changes drastically based on the factors or income level, standard of living, competition in the market. It cannot be said that Real Fruit Juice uses skimming pricing but yes , it is priced at a slightly higher price because the product is advertised as the premium product in the category and going by the standards set by it, the price seems feasible.

There has been no change in the pricing of the product since its onset in 2005 and it has worked in its favor as we can see that the market share has been on an increase ever since. It has gone up from 33% from 2007 to 55% currently.

Real Fruit Juice's premium pricing adds further assurance of the quality, consistency and concern for their customers. Higher prices affirm customers’ beliefs and attract even more buyers to Real Fruit Juice. Even during recession the price of the commodity was not brought down and it worked in its favor as the sales were on an increase. As a result, with the continuation of recession, consumers increasingly turned to increasingly available and increasingly high-quality, private-label brands.

Real Fruit Juice vs. Tropicana

Tropicana is higher priced as compared to Real Fruit Juice. A 1 liter Tropicana juice is available at 99 INR whereas a 1 Liter Real Fruit Juice is available at 95 INR. This also seems to be working in favor of Real Fruit Juice as its consumption has been on an increase. As far as the number of variants is considered Tropicana have more variants in comparison to Real Fruit Juices. Competing on pricing with Real Fruit Juice has become increasingly difficult for Tropicana. They have adopted differential pricing in which different flavors are priced differently but still it seems to have not worked out for them.