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    Miele employs a premium pricing strategy, charging at least 20% more than competitors. Miele positions itself as a luxury brand focused on quality and longevity. Customers are willing to pay higher prices for Miele's promise of products that last 20 years and are among the best in technology and ecology. While maintaining premium prices, Miele works to control costs and ensure its price gap to competitors does not become too large. In some markets like Asia and Russia, Miele strategically positions itself as a pure luxury brand where wealthy customers want the best, most expensive products. This strategy, combined with Miele's focus on quality, has contributed to the company's sustained success and record revenues of $4.25 billion in 2013

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    11 Activity 2

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    Miele employs a premium pricing strategy, charging at least 20% more than competitors. Miele positions itself as a luxury brand focused on quality and longevity. Customers are willing to pay higher prices for Miele's promise of products that last 20 years and are among the best in technology and ecology. While maintaining premium prices, Miele works to control costs and ensure its price gap to competitors does not become too large. In some markets like Asia and Russia, Miele strategically positions itself as a pure luxury brand where wealthy customers want the best, most expensive products. This strategy, combined with Miele's focus on quality, has contributed to the company's sustained success and record revenues of $4.25 billion in 2013

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    Miele employs a premium pricing strategy, charging at least 20% more than competitors. Miele positions itself as a luxury brand focused on quality and longevity. Customers are willing to pay higher prices for Miele's promise of products that last 20 years and are among the best in technology and ecology. While maintaining premium prices, Miele works to control costs and ensure its price gap to competitors does not become too large. In some markets like Asia and Russia, Miele strategically positions itself as a pure luxury brand where wealthy customers want the best, most expensive products. This strategy, combined with Miele's focus on quality, has contributed to the company's sustained success and record revenues of $4.25 billion in 2013

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    148 views2 pages

    11 Activity 2

    Uploaded by

    •MUSIC MOOD•
    Miele employs a premium pricing strategy, charging at least 20% more than competitors. Miele positions itself as a luxury brand focused on quality and longevity. Customers are willing to pay higher prices for Miele's promise of products that last 20 years and are among the best in technology and ecology. While maintaining premium prices, Miele works to control costs and ensure its price gap to competitors does not become too large. In some markets like Asia and Russia, Miele strategically positions itself as a pure luxury brand where wealthy customers want the best, most expensive products. This strategy, combined with Miele's focus on quality, has contributed to the company's sustained success and record revenues of $4.25 billion in 2013

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    Activity

    Miele

    Miele, a home appliance manufacturer, charges at least 20% more than its competitors. Co-
    managing director Markus Miele explained how they do that: “We are at home in the premium
    segment. Our products are engineered to last for 20 years. In terms of technology and ecology,
    they are among the best you can buy. People are willing to pay higher prices for this promise of
    quality.” Markus Miele ’s words capture the essence of exceptional pricing. But even the
    manufacturers of premium products need to keep their eye on the competition. In Miele’s
    words: “Of course Miele needs to make sure that our price gap to the relevant competitors
    does not become too big. For that reason, we continuously work on our cost structure. We
    never neglect our company’s motto ‘forever better’. We cannot win a battle based on having
    the lowest price, but we will win when the battle is about having the best product.” In some
    parts of the world, Miele is viewed as a true luxury good. Said Reinhard Zinkann, grandson of
    one of Miele’s founders and co-managing director: “In Asia and Russia, wealthy people want to
    surround themselves with the best and the most expensive products on the market. That is why
    we positioned Miele as a pure luxury brand in those markets.” In 2013, Miele’s revenue
    reached a record of $4.25 billion. The company does not publish profit data. But Miele has a
    very high equity ratio and no debt on its balance sheet, which proves that it must earn solid
    profits year after year. Its motto “Forever Better” hasn’t changed for 100 years; it is the core
    and heart of Miele’s strategy, the cornerstone of its lasting success as a superior brand.

    Answer the following questions: (3 items x 10 points)


    1. What type of price strategy/positioning is being employed by Miele based on the case study?
    - In this case study miele declare their company as a pure luxury product in the Asia and Russia,
    according to the case study miele’s product is true luxury product in the market in some part of
    the world. The pricing strategy Milele use is the premium- pricing strategy because the price of
    their product is high and the price speak to its quality.
    2. What is/are the factor/s that contribute/s to the success of the company using its price
    positioning
    strategy?

    - The factors that contribute to the success of the company are the, first is Highest level of
    performance because miele deliver their product with superior performance across all
    dimensions including materials, product quality,service, communication, and distribution,
    second is the prestige effect is a big driver because the miele price of the product as a quality
    indicator for the consumers, and the last is Having control of the value chain because they take
    control of the value specially is Asia and in the Russia that’s why they are still distributing their
    products with a premium price without affecting the sales.

    3. How can the company achieve success by using a different price positioning strategy?

    The company achieved success because even though miele use different price positioning
    strategy they always think about on how they will satisfied their costumer even though their
    products are expensive, and also they stick to their originals goa; that’s why they achieved to be
    successful.

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