Custom essays on The role of discounts in Lexus’ pricing strategy

In this regard, discounts contribute consistently to the motivation of employees because they can offer customers an opportunity to purchase an exclusive car at the price lower than other companies can offer them. In such a way, Lexus attracts customers by the system of discounts, which is attractive for customers. In addition, discounts offered by Lexus to its customers develop the customer loyalty. What is meant here is the fact that customers view discounts as the possibility to purchase an excellent vehicle and benefit from it. Therefore, they develop the loyalty to the brand because they believe that Lexus can offer them the flexible pricing policy and sell cars at lower price.
Distribution strategy of Lexus
The distribution strategy is equally important for the overall marketing success of Lexus as its pricing strategy. In this regard, it is important to place emphasis on the fact that the company attempts to reach its target customer group through the effective distribution. At the same time, the company focuses on the upper-class customers. Therefore, the company focuses on the individual distribution to deliver vehicles to its target customers. In such a way, the company uses the customer-centered approach to attract them and to increase its sale rates. This distribution strategy fits its target customer group because customers of Lexus need exclusive cars and they want to receive vehicles that have specific features and technologies, which meet their expectations.
Therefore, the company should focus on the development of the customer loyalty through the customer-oriented distribution strategy. In such a way, the company attempts to enhance its position through fitting customers’ needs and wants. The company offers exclusive vehicles, which are manufactured specifically for each customer. At the same time, the exclusiveness of Lexus’ vehicles stimulates customers to buy Lexus’ cars.
Conclusion
Thus, it proves beyond a doubt that Lexus uses its pricing and distribution strategy. In such a way, the company uses the pricing and distribution strategy to attract customers to its products. Lexus offers customers a system of discounts. In addition, the company creates exclusive vehicles of the high quality. Moreover, the customer purchasing Lexus’ vehicles can enjoy technological advancements because the company introduces innovations to attract more customers but innovations increase the costs of manufacturing of Lexus’ vehicles that naturally increases the price of Lexus’ vehicles. Nevertheless, customers are ready to pay for Lexus’ vehicles and they stay loyal to the brand.
References
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Florissen, Andreas; Maurer, Boris; Schmidt, Bernhard; & and Vahlenkamp, Thomas (2001, August). The race to the bottom: When industries deregulate, their managers face unfamiliar challenges. Price wars are often the unfortunate and unnecessary result. McKinsey Quarterly. McKinsey & Company.
Bertini, Marco, and Luc Wathieu, How to Stop Customers from Fixating on Price. Harvard Business Review Vol. 88 (May), p. 84-91
Rafi, Mohammed Ditch the Discounts. Harvard Business Review; Jan/Feb2011, Vol. 89 Issue 1/2, p23-25, 3p, 2 Color Photographs
Hill, Dan (2010 November 09). Hill-Pricng-MktProfs.doc. Seven Reasons Why Leading With Price Will Kill Your Advertising, Your Branded Offers and Your Company, Marketing Profs.
Henricks, Mark (2010 November 19). Price-Cutting Peril: Do You Know What You’re Doing Really? The Debunker. BNet.