penetration pricing

Cards (4)

  • What is penetration pricing?
    Setting a price really low on a new product to encourage sales and persuade them to try the product
  • What should the lower prices lead to?
    Business gaining more market share
  • Give a benefit of penetration pricing?
    Works best with new products being launched to encourage customers to try the product
  • Give 2 drawbacks of penetration pricing?
    Consumers may have brought without the low price anyway
    Expensive - reduces sales revenues which eats into profits