Profit is what remains after paying for costs and expenses out of sales revenue. You can set pricing objectives to meet specific targets for profit returns. You can also use pricing targets for gross margin , the amount that remains after deducting the cost of goods sold from sales revenues. To increase gross margin you can raise prices, lower the cost of goods sold, or do both. Pricing for gross margin can be tricky.
Many marketers use pricing to maximize current profits, trying to make the highest profits now.
This approach is used to satisfy investors and market analysts watching quarterly returns. However, a marketer is exposed to competition from more patient marketers, willing to invest in long-term relationships. C. Pricing for Sales Growth 1. Growth in sales can mean starting more new customer relationships as well as encouraging current customers to buy more. You can set prices to sell a higher number or dollar amount of products, or to achieve a higher market share.