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Marketing
Price
Price strategies
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Created by
Zainab kaman
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Cards (11)
Cost-based pricing
Different
prices
are charged for the
same product
depending on the
time
,
age
and etc.
Penetration pricing
Low
price at start to access
gain
to the market
Often used when there are
closed competitors
Price is
raised
over time
Promotional
pricing
Vouchers
/offers/
discounts
are offered to
encourage
customers
Prices are
reduced
for a
short
period of time
Used to quickly sell
inventory
and aid cash flows
Skimming
pricing
Setting a
high
initial price for the product when it is new
Ideal to use when there is little to no competition
Prices gradually
lowers
overtime
High
profit margins during the
introduction
stage to help
recover
costs
Destroyer
pricing
Prices are kept very
low
to
destroy
competition
Illegal
in the UK
High/
premium
pricing
Using a price to
deliberately
to signal that the products are
luxurious
, good
quality
/
exclusive
image
Sales will be
lower
but there will be
high profit
margins on each sale
Low/valuing pricing
Long term
pricing strategy setting the price
below
the
competiton
Customers will often look for a
cheaper
alternative of a way of
saving money
Psychological
pricing
A
price
which makes the customer thinks that is a lot
cheaper
for example
99p
instead of
£1
Loss Leaders
Price of one item is set much
lower
than that of competitors
Often a
pricing tactic
used by supermarkets
A
loss
is made on this product but it brings customers to the shop to buy the products where they are
enticed
to buy other
full price
items
Dynamic pricing
Prices will vary, low when demand is
low
and high when demand is high
Cheap flights
at different times of the year
Market/Competitive
Long term price strategy
selling the price
similar
to other
competitors
Requires ongoing
promotion
/
advertising