chapter 11.2 Flashcards
amount of money requested/exchanged for a product
price
relative worth of something to a person
value
explanation of a value of a certain product over others that are similar
value proposition
the established price printed in a catalog, on a price tag, or on a price list
list price
the actual price a customer pays for a product after any discounts or coupons are deducted
selling price
price recommended by the manufacturer
manufacturer’s suggested retail price (MSRP)
goals defined in the business and marketing plans for the overall pricing policies of the company
pricing objectives
a pricing objective based on offering the lowest price possible to get the largest number of customers to buy the product
maximizing sales
a pricing objective that aims to generate as much revenue as possible in relation to total cost
maximizing profit
Company goals, expenses, customers perception, competition, supply and demand, economic conditions, product life-cycle
factors influencing a price of a product
price of a brand new product is often high
introduction stage
more competitors enter the market and the high price of new products usually falls
growth stage
sales and price of products are stable
maturity stage
price is often significantly reduced and some products are eliminated
decline stage
the point at which revenue from sales equals the cost (product starts making profit)
break-even point
the amount added to the cost to determine the price
markup
the general price at which the company expects to sell the product
base price
pricing techniques that create an image of a product that entice costumer’s to buy
psychological pricing
prices end in an odd number
odd pricing
prices end in an even number
even pricing
prices high to convey quality and status
prestige pricing
various prices for same type of product to indicate different levels of quality
price lining
free or reduced-price item when another is purchased at full price
Buy one Get one (BOGO) pricing
combines two or more products for one price
bundling
selling overseas
international
selling where you are
geonational
a percentage deducted from the total invoice amount
cash discount
given to businesses that agree to advertise or promote a manufacturer’s product
promotional discount
offers a reduced per-item price for larger numbers of an item purchased
quantity discount
offered by retailers when they buy goods well in advance of a season
seasonal discount
the way manufacturers quote prices to wholesalers and retailers; percentage off list price
trade discount
the practice of advertising one product with the intent of persuading customers to buy a more expensive item when they arrive in store
bait and switch
a group of competitors get together and set the price for a specific product
pricing fixing
when a company sells the same product to different customers at different prices based on their personal characteristics of the customer
price discrimination
the illegal pricing of products in a way that intentionally misleads customers
deceptive pricing
the practice of setting very low prices to get rid of competition
predatory pricing
pricing an item much lower than the current market price or the cost of acquiring a product
loss leader
the raising of prices on certain kinds of goods to an excessively high level during an emergency
price gouging
maximum price set by government for certain goods and services that it thinks are being priced to high
price ceilings
minimum price set by the government for certain goods and services that it thinks are being priced to low
price floors
