10 - Pricing strategies

Question 1

Factors influencing price

Answer 1

costs
competition
YED and PED
branding

Question 2

predatory pricing

Answer 2

where a business sets a low price in order to price compeitiors out of the market

Question 3

competitive pricing

Answer 3

basing prices off of competitors

Question 4

psychological pricing

Answer 4

pricing below the next whole number to trick consumers into believing it is less, such as 99p instead of £1

Question 5

Price skimming

Answer 5

setting a high price initially when demand is high to maximise profits

Question 6

cost-plus pricing

Answer 6

basing the price on the unit costs and then adding a percentage mark up

Question 7

How may a business adapt to reflect social trends?

Answer 7

• auction sites
• price comparison sites
• personalised pricing
• subscription sites

Question 8

auction sites and adating to social trends

Answer 8

encourage customers to bid using a sense of emergency, many buisinesses use this alongside their own sites

Question 9

price comaprison sites and adapting to social trends

Answer 9

businesses have to remain competitive due to the amount of price comparison sites that show the buyer the best deals

Question 10

subscription pricing and adapting to social trends

Answer 10

a business charges custoemrs a monthly fee, suitable for online services

Question 11

personalised pricing and adapting to social trends

Answer 11

databases collect customer info and allow businesses to target them at a personal price