I think value pricing should be used since we are increasing product and service benefits while maintaining a reasonable price. Some products, price influences consumers perception of overall quality and ultimately its value to them (Kerin & Hartley, 2022). This strategy is important to the the market needs because this strategy is based off the perceived value of the product in the market. The value sets the price whereas the price would drop, if the quality dropped. Adjusting the pricing strategy based off of the product life cycle because of the 5 phases. The 5 phases of the product life cycle are the introduction, growth, maturity and decline phase.

With that said, target profit pricing can also be utilized because after the value pricing at the launch/introduction phase, because once the bikes have penetrated the market, we can establish a target price to maintain as it hits the maturity and decline phase. The introduction and growth phase are when the value pricing strategy should be implemented because with the growth phase, this is when customers are buying the product, and the sales are increasing so we want to push the quality and value these bikes will provide. Maturity phase is when the product sales decline and most of our target consumers from the beginning have the product. Decline phase is when the product has lost a lot of market share and there is more competition. This is when you should can implement a minimal target price with a limited production units to still get margin.

 

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