Pricing and Distribution in Marketing Decisions - Essay Example

This paper illustrates that for many years, the Ford Escort was among the top-selling automobiles in America. The Ford Motor Company uses the value pricing strategy to gain a market share in the global market. This strategy has been used as an initial step of eliminating the common costly customer returns. This initiative seeks to enhance the customer’s buying experience with a view to curbing the distrust in relation to the sale of retail cars. It is for this reason that the Ford Motor Company has at one time tried low-pricing on its vehicle models including the Ford Escort.

Such moves are meant to increase the profit margins of the company. As a result, the scantly equipped models were eliminated. They were then replaced with fairly loaded automobiles which had comparable prices. The company eventually witnessed increased sales. A true account is that production of vehicles with similar options increases manufacturing efficiency. A number of models irrespective of the model style were sold for the same price. As much as many consumers around the world found it hard to believe the existence of such an offer, they still went ahead to purchase the products.

Ford has also used price discrimination for instance in Great Britain and Belgium to maximize its profits. This pricing strategy makes economic sense in light of imposing different charges for different countries. The Toyota Motor company also used the price discrimination strategy. The Lexus Es was therefore sold for different prices for instance in the US as compared to the European countries. Toyota has also employed the predatory pricing strategy to market the Lexus Es as a luxury car. This strategy has been very common with Japanese companies.

Toyota takes advantage of its profitable position in Japan. Toyota has since used its strong profit position in Japan to subsidize the aggressive pricing in other markets across the world. Predatory pricing has since received sharp criticisms from market shareholders across the globe.