Mercedes Benz, the German automobile manufacturer, is one of the largest automakers by sales and has a wide range of cars, sports cars, SUVs, buses, and trucks. The three-pointed star logo is one of the famous logos globally, and their motto is “Best or Nothing,” which they achieved successfully. In automobile markets, the prices of Mercedes Benz products range from around $30,000 to $100,000 and more.
Price Ranges of the Top Products
There are a lot of top-selling Mercedes-Benz models worldwide, and those models got positive feedback from the customers because of their performance and price ranges. One of the top-selling models of Mercedes-Benz is the GLC which starts from $32,500. The GLE & GLS are two of the most demandable cars among the customers. The price ranges start from $54,750 and $76,000, respectively. Again, the S-Class is their best-selling luxury sedan worldwide, costing $94,250, and this model received a strong positive customer response worldwide. The Mercedes-AMG has covered the largest market share in the USA, Germany, China, Japan, and Australia because of its high performance. The price range of this model starts from $89,900.
Pricing Strategies of Mercedes-Benz
Mercedes-Benz is following certain pricing strategies. A few of those strategies are being discussed below.
Premium Pricing Strategy
Mercedes Benz is premium-priced car brand, and its target market is a niche where they prefer quality over price. As a result, their products’ price ranges are always on the higher end. Mercedes-Benz always caters to the luxury car markets worldwide, for which it invests a lot of money on high-cost materials. Hence, based on its features and quality, the first and foremost pricing strategy of Mercedes-Benz is premium priced.
Related Article: Pricing Strategies of Nike
Prestige Pricing Strategy
To promote and maintain the image and the quality of the products to the high-end clientele, Mercedes-Benz, one of the most luxurious companies globally, uses the prestige pricing strategy. The company uses such a pricing strategy for the products where customers are interested in paying more for high-quality products which look luxurious at the same time.
Price Skimming Strategy
Mercedes-Benz uses this pricing strategy for different phases in different parts of the world. This company utilizes this strategy at different times, intending to generate more profits from around the globe. By using this pricing strategy, Mercedes-Benz focuses on its target customers willing to pay a premium price for the brand.
Cost-Based Pricing
Using this cost-based pricing, Mercedes-Benz can find out what it takes to produce a product, and then it can put a markup based on how much profit it wants to earn. However, this strategy is not feasible in a highly competitive strategy with dynamic pricing.
Competition Based Pricing
This pricing strategy is being followed by Mercedes-Benz because of the strong competition in the automobile market. This strategy helps the company match the prices of the products with the competitors and reduce the operating costs to make more profits in the business.
Apart from the above mentioned pricing strategies, Mercedes-Benz also follows a few more pricing strategies which are mentioned below –
- Value-Based Pricing Strategy
- Market Penetration Pricing Strategy
- Good Value Pricing Strategy etc.
Pricing Strategies Applied by the Competitors
There is intense competition from the competitors of Mercedes-Benz in the market worldwide. These competitions of global automobile brands can impact Mercedes-Benz in terms of doing business. Here are a few pricing strategies stated about which are being applied by the competitors.
BMW Group’s Pricing Strategy
BMW group is one of the global leaders in producing premium cars. This company has been successful in the automobile industry with the help of its pricing and marketing strategies. A few of its pricing strategies are given below.
Value Pricing Strategy: This is one of the top pricing strategies BMW uses. With a focus on assuring high-quality products to the customers, BMW group charges a premium price. In this case, the company tries to use this price-quality relationship to adjust the prices of the products. This relationship points out that customers can get the qualitative product according to the price.
Prestige Pricing Strategy: This is a strategy where the BMW group can charge for the products based on the customers’ perceptions rather than the products’ actual costs. Customers are more lenient to pay higher prices for their suitable products, not for the actual value of the products. By using this pricing strategy, BMW can capitalize the consumer perceptions against its competitors. It can also prove that the brand, BMW, has more high-quality products than others in the market.
Luxury Pricing Strategy: BMW sets up this pricing strategy to categorize the company itself in the “Desirable” category of the market. This pricing strategy also says that the company is not weak yet in the competition and is still on top in the automobile market.
Related Reading: Pricing Strategies of PepsiCo
Audi’s Pricing Strategy
Audi’s pricing strategy helps the company make a good position in the automobile industry and achieve its business goals. This brand is seen as a luxury in the minds of customers. This price strategy mirrors the brand image to the customer of Audi.
Premium Pricing Strategy: Audi uses this pricing strategy based on the premium products and the competitive pricing of premium car manufacturers. Audi offers premium models of cars to attract the higher-end segments of customers and let the customers access the brand easily at the same time. The premium pricing of this brand is associated with its positioning strategy and its premium image in the global automobile market.
Geographical Pricing Strategy: Another interesting pricing strategy that Audi follows is the geographical pricing strategy. Audi makes this pricing strategy based on the distance and economic condition of those parts of the world. This company focuses on a certain class of people and sells products accordingly.
Bottom Line
Mercedes-Benz still holds its position on top of the automobile industry with its impressive pricing strategies for more than 100 years. This brand is the first choice among people from different age groups. Using the pricing strategies mentioned above, we can say that Mercedes-Benz has been wonderfully doing its business globally with pride.
Resources
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Sadnan is one of the top contributors of The Strategy Watch, he has been actively contributing since 2017 as a Content Analyst; He has finished his graduation from North South University with a dual major in Accounting & Finance. As a contributor, he has written for different topics including Leadership Styles and Qualities, Finance, and Economics. He also has a strong interest in SWOT & PESTLE Analysis and Marketing Strategy.