2. Content of the Course

София 1700, Студентски град “Христо Ботев”,

Adopted by a decision issued by the Faculty Endorsed: Council of „Management and Administration” Dean

Protocol № /

CURRICULUM

Academic subject: PRICE POLICY Subject code: B33834C0642 Educational and qualification degree: Bachelor Status of the course: Compulsory, Department course Field of higher education: 3. Social, Economic and Law Sciences Professional: 3.8. Economics Economics taught in English Specialty: 3.8.34. Marketing and Strategic Planning Faculty: Management and Administration Department: Marketing and Strategic Planning Total student academic load 30/30 (average classes per course): Non-contact student academic load 90 Credits: 6 Lecturer of the course: Assoc. Prof. Tatyana Neycheva Netseva-Porcheva, Ph.D.

Идентификация на статуса: ОДНК_7.1.3-1/ Версия 01/Изменение ____/______; стр. __/__ Ниво на достъп: □ общодостъпен □ за служебно ползване □поверителен □секретен ANNOTATION

1. The academic course ”Price Policy” start from the academic year 2014-2015 with the students of the specialty “Marketing and Strategic Planning”, part of the professional field of study „Economics“ - Economics taught in English, of the educational and qualification degree of “Bachelor”.

2. Content of the course: The purpose of the course "Price Policy" is students to build theoretical knowledge and practical skills in the area of the pricing policy of the company. The course is structured in seven parts. The first part gives answer the question “What is a price?” and examines pricing as a marketing activity. It discusses also the importance of the pricing in today’s fast- changing environment. The second part examines internal and external considerations affecting price decisions: overall marketing strategy, objectives and other elements of the marketing mix, organizational considerations, the market and demand, the costs and profit, the economy and other external factors. The third part is devoted to the pricing objectives - types of pricing objectives and their essence. The fourth part is dedicated to demand and price sensitivity of buyers to price level. The fifth part examines types of costs and levels of production. The sixth part explains the three major pricing methods - cost-based pricing, customer value-based pricing, and competition-based pricing - their essence, application, advantages and disadvantages. It discusses also the importance of understanding, company costs, customer-value perceptions, and competitor strategies when setting prices. The seventh part describes the major strategies for pricing new products, explains how companies find a set of prices that maximizes the profits from the total product mix, discusses how companies adjust their prices to take into account different types of customers and situations, examines the key issues related to initiating and responding to price changes, etc.

3. Language of education: English

Идентификация на статуса: ОДНК_7.1.3-1/ Версия 01/Изменение ____/______; стр. __/__ 2 Ниво на достъп: □ общодостъпен □ за служебно ползване □поверителен □секретен CONTENT OF THE CURRICULUM

А. LECTURES № TOPIC Classes Part 1: INTRODUCTION 2  What Is a Price?  Pricing as a Marketing Activity

Part 2: INTERNAL AND EXTERNAL CONSIDERATIONS 2 AFFECTING PRICE DECISIONS  Overall Marketing Strategy  Objectives and Other Elements of Marketing Mix  Organizational Considerations  The Market and Demand  The Costs and Profit  The Economy  Other External Factors

PART 3: PRICING OBJECTIVES 2  Survival  Maximum Current Profit  Maximum Market Share  Maximum Market Skimming  Product-Quality Leadership  Other Objectives 3 PART 4: DETERMINING DEMAND  Price Sensitivity  Estimating Demand Curves  Price Elasticity of Demand  Techniques to measuring of price sensitivity

PART 5: ESTIMATING COSTS 3  Types of Costs and Levels of Production  Accumulated Production  Target Costing

Part 6: PRICING METHODS 4 Cost-Based Pricing  Economic logic of cost-based pricing  Why cost-based pricing is so popular?  Basic methods of cost-based pricing – Cost Calculating Pricing, Full Cost Recovery Pricing (FCRP), Variable Cost

Идентификация на статуса: ОДНК_7.1.3-1/ Версия 01/Изменение ____/______; стр. __/__ 3 Ниво на достъп: □ общодостъпен □ за служебно ползване □поверителен □секретен Recovery Pricing (VCRP), Marginal Cost Pricing, Contribution Based-Pricing, Target ROI Pricing.

Customer Value-Based Pricing 4  What is Value?  Value of product as factor to determine its price.  Approaches for measuring and reporting the value of pricing – Customer Value Modeling (CVM) and Economic Value Modeling (EVM).  Applying a value map in pricing and marketing.

Competition-Based Pricing 4  Going-Rate Pricing (Competitor Parity Pricing)  Competitive Bidding  Predatory Pricing

Part 7: PRICING STRATEGIES

New-Product Pricing Strategies 2  Market-Skimming Pricing  Market-Penetration Pricing

Product Mix Pricing Strategies 1  Product Line Pricing  Optional Product Pricing|  Captive Product Pricing  By-Product Pricing  Product Bundle Pricing

Price Adjustment Strategies 1  Discount and Allowance Pricing  Segmented Pricing  Psychological Pricing  Promotional Pricing  Geographical Pricing  Dynamic Pricing  International Pricing 1 Price Changes  Initiating Price Changes  Responding to Price Changes 1 Public Policy and Marketing

Идентификация на статуса: ОДНК_7.1.3-1/ Версия 01/Изменение ____/______; стр. __/__ 4 Ниво на достъп: □ общодостъпен □ за служебно ползване □поверителен □секретен  Pricing within Channel Levels  Pricing Across Channel Levels

B. SEMINARS № TOPIC Student Student Contact non- academic contact load academic (number load of (number classes). of classes).

WHAT IS A PRICE? PRICING AS A MARKETING 2 ACTIVITY  Kotler P., G. Armstrong, Principles of Marketing, 14ed, Pearson, New Jersey, 2012  Kotler P., K. Keller, Marketing Management, 14ed, Prentice Hall, New Jersey, 2012

2. INTERNAL AND EXTERNAL CONSIDERATIONS 2 AFFECTING PRICE DECISIONS • Kotler P., G. Armstrong, Principles of Marketing, 14ed, Pearson, New Jersey, 2012

3. PRICING OBJECTIVES 2 • Kotler P., K. Keller, Marketing Management, 14ed, Prentice Hall, New Jersey, 2012

4. DETERMINING DEMAND 3  Kotler P., K. Keller, Marketing Management, 14ed, Prentice Hall, New Jersey, 2012

5. ESTIMATING COSTS 3  Kotler P., K. Keller, Marketing Management, 14ed, Prentice Hall, New Jersey, 2012

6. PRICING METHODS Cost-Based Pricing 4  Kotler P., G. Armstrong, Principles of Marketing, 14ed, Pearson, New Jersey, 2012  Kotler P., K. Keller, Marketing Management, 14ed, Prentice Hall, New Jersey, 2012

Идентификация на статуса: ОДНК_7.1.3-1/ Версия 01/Изменение ____/______; стр. __/__ 5 Ниво на достъп: □ общодостъпен □ за служебно ползване □поверителен □секретен  Macdivitt, H. and M. Wilkinson, Value-Based Pricing, Drive Sales and Boost Your Bottom Line by Creating, Communicating and Capturing Customer Value, McGraw-Hill, 2012  Nagle, T., J. Hogan and J. Zale, The Strategy and Tactics of Pricing – A Guide to Growing More Profitable, 5 ed., Pearson, New Jersey, 2011  Schindler, R., Pricing Strategies: A Marketing Approach, SAGE Publications, Inc., 2012

Customer Value-Based Pricing 4  Kotler P., G. Armstrong, Principles of Marketing, 14ed, Pearson, New Jersey, 2012  Kotler P., K. Keller, Marketing Management, 14ed, Prentice Hall, New Jersey, 2012  Macdivitt, H. and M. Wilkinson, Value-Based Pricing, Drive Sales and Boost Your Bottom Line by Creating, Communicating and Capturing Customer Value, McGraw-Hill, 2012  Nagle, T., J. Hogan and J. Zale, The Strategy and Tactics of Pricing – A Guide to Growing More Profitable, 5 ed., Pearson, New Jersey, 2011  Schindler, R., Pricing Strategies: A Marketing Approach, SAGE Publications, Inc., 2012  Smith, T., Pricing Strategy: Setting Price Levels, Managing Price Discounts and Establishing Price Structures, South-western, Cengage Learning, 2012  Baker, W., M. Marn and C. Zavada, The Price Advantage, John Wiley & Sons, Inc., 2010 4 Competition-Based Pricing  Kotler P., G. Armstrong, Principles of Marketing, 14ed, Pearson, New Jersey, 2012  Macdivitt, H. and M. Wilkinson, Value-Based Pricing, Drive Sales and Boost Your Bottom Line by Creating, Communicating and Capturing Customer Value, McGraw-Hill, 2012  Nagle, T., J. Hogan and J. Zale, The Strategy and Tactics of Pricing – A Guide to Growing More Profitable, 5 ed., Pearson, New Jersey, 2011

7. PRICING STRATEGIES 6  Kotler P., G. Armstrong, Principles of Marketing, 14ed, Pearson, New Jersey, 2012 Идентификация на статуса: ОДНК_7.1.3-1/ Версия 01/Изменение ____/______; стр. __/__ 6 Ниво на достъп: □ общодостъпен □ за служебно ползване □поверителен □секретен  Kotler P., K. Keller, Marketing Management, 14ed, Prentice Hall, New Jersey, 2012  Nagle, T., J. Hogan and J. Zale, The Strategy and Tactics of Pricing – A Guide to Growing More Profitable, 5 ed., Pearson, New Jersey, 2011  Schindler, R., Pricing Strategies: A Marketing Approach, SAGE Publications, Inc., 2012  Smith, T., Pricing Strategy: Setting Price Levels, Managing Price Discounts and Establishing Price Structures, South-western, Cengage Learning, 2012

METHOD / TEACHING STRATEGY:

The teaching is done through the combination and expands of lectures with seminars, solving of cases and tasks. PowerPoint, slides and other technical devices are used.

INDIVIDUAL ASSIGNMENTS:

The connection with the practice is ensured by placing individual assignments to the students. Assignments are placed and defended during the seminars according to individual preferences and abilities of the students. Practical work is for a particular real economic object. It is evaluated separately and there is a certain weight in the final assessment for the course.

ASSESSMENT METHODS:

During the semester the students are making individual assignments and they have to do two interim tests. The students which results of the individually assignment and both tests are Very Good /5/ or Excellent /6/ to be exempt from the exam. The other students take an examination.  The formula for the final assessment, for all students, is formulating (exempt from examination and appearing for an examination) as the following:

FA = 0,2*T1+0,2*T2+0,3*Т+0,3*IA, Where FA = final assessment T1, T2 = evaluation of the two tasks Т = assessment on the theoretical material IA = assessment of the individual assignment  The final score was a six-point system. The minimum score for the successful completion of the training is Fair /3/.

Идентификация на статуса: ОДНК_7.1.3-1/ Версия 01/Изменение ____/______; стр. __/__ 7 Ниво на достъп: □ общодостъпен □ за служебно ползване □поверителен □секретен A compliance assessment with the European system of credit transfer is as follows:

Excellent /6/ Very good /5/ Good /4/ Fair /3/ Poor /2/ A B C D E FX F Credits are awarded as provided for in the plan No credits awarded

EXPECTED RESULTS OF THE ACADEMIC TRAINING

Students will acquire skills: • To define prices, taking into account the priority factors and linking them with the methods of pricing. • To prepare analysis and assessments of various pricing decisions. • To operate and offer an arsenal of pricing strategies and develop pricing programs.

The knowledge and skills of the course „Pricing Policy“ are necessary for the successful studying of the material related to other academic courses like: „Marketing Planning“, „Marketing Control“, „International Marketing“, etc.

DISSEMINATION OF THE COURSE:

1. Pricing Policies, Pompeu Fabra University, Barcelona, Spain 2. Pricing Strategy, Aarhus University, Aarhus, Denmark 3. Pricing, Novancia Business School, Paris, France 4. Pricing Strategy, Anglo-American University, Prague, Czech Republic

TOTAL STUDENT ACADEMIC LOAD

Type of classes/academic load Overall Student Student Total student academic non-contact academic load, academic load average load classes per week Lectures 30 2 30 Seminars 30 2 10 30 Laboratory training Practical training Term paper Final thesis Individual assignment 20 Interim exam/test 30 On-going assessment 10 Exam 20 Total 60 4 90 60

RECOMMENDED LITERATURE

Идентификация на статуса: ОДНК_7.1.3-1/ Версия 01/Изменение ____/______; стр. __/__ 8 Ниво на достъп: □ общодостъпен □ за служебно ползване □поверителен □секретен А. BASIC 1. Kotler P., G. Armstrong, Principles of Marketing, 14ed, Pearson, New Jersey, 2012 2. Kotler P., K. Keller, Marketing Management, 14ed, Prentice Hall, New Jersey, 2012 3. Macdivitt, H. and M. Wilkinson, Value-Based Pricing, Drive Sales and Boost Your Bottom Line by Creating, Communicating and Capturing Customer Value, McGraw- Hill, 2012 4. Nagle, T., J. Hogan and J. Zale, The Strategy and Tactics of Pricing – A Guide to Growing More Profitable, 5 ed., Pearson, New Jersey, 2011 5. Schindler, R., Pricing Strategies: A Marketing Approach, SAGE Publications, Inc., 2012 6. Smith, T., Pricing Strategy: Setting Price Levels, Managing Price Discounts and Establishing Price Structures, South-western, Cengage Learning, 2012

B. ADDITIONAL 1. Baker, W., M. Marn and C. Zavada, The Price Advantage, John Wiley & Sons, Inc., 2010 2. Hinterhuber, A., S. Liozu, Innovation In Pricing: Contemporary Theories and Best Practices, Taylor & Francis Group, 2012 3. Stiving, M., Impact Pricing: Your Blueprint for Driving Profits, Ep Entepreneur Press, 2011

DRAFTED BY: Associate Professor Tatyana Netseva- Porcheva, Ph.D. …

HEAD OF DEPARTMENT: Associate Professor Pencho Ivanov, Ph.D. …………………

DEAN: Professor Мargarita Harizanova, Ph.D. ………………………

Идентификация на статуса: ОДНК_7.1.3-1/ Версия 01/Изменение ____/______; стр. __/__ 9 Ниво на достъп: □ общодостъпен □ за служебно ползване □поверителен □секретен