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MKTG 321 Test 3 > Chapter 21 > Flashcards

Chapter 21 Flashcards

1
Q

value paid for a product in a marketing exchange

A

price

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2
Q
  • price does not always take the form of money

- oldest form of trade is barter

A

nature of price

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3
Q

importance of price to marketers:

A
  • price affects demand
  • price affects profits
  • price has a psychological dimension
  • price has important legal implications
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4
Q

stages for establishing prices

A
  1. development of pricing objectives
  2. assessment of target market’s evaluation of price
  3. evaluation of competitors’ prices
  4. selection of a basis for pricing
  5. selection of a pricing strategy
  6. determination of a specific price
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5
Q

stage 1:

goals that describe what a firm wants to achieve through pricing

A

pricing objectives

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6
Q

Stage 2:Target market’s evaluation price

combines product’s price and quality attributes

A

-type of product
-type of target market
-purchase situation
————————————-
value focus

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7
Q

Stage 3: Evaluation of Competitors

A
  • regular function of marketing research
  • importance of customer’s view of pricing and marketing mix variables
  • —pricing above competition creates an exclusive image
  • —pricing below competition gains market share
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8
Q

Stage 4: Pricing Basis

adding the cost of the product a predetermined percentage of that cost

A

cost based pricing

markup

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9
Q

customers pay a higher price when demand for the product is strong and a lower price when demand is weak

A

demand-based pricing

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10
Q

pricing influenced primarily by competitors’ prices

  • -method increases when:
  • —competing products are homogeneous
  • —organization is serving markets in which price is a key consideration
A

competition-based pricing

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11
Q

market research technique where consumers make tradeoffs between features and benefits and price

A

conjoint analysis

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12
Q

final price established through buyer/seller bargaining
————————————
one price for primary target market and different price for another

A 
differential pricing
-------------------------
negotiated
------------------------
secondary-market
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13
Q

new product pricing

set prices below competition to gain share early

A

penetration pricing

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14
Q

Product line pricing

price an item low, hoping customer will buy higher priced product

A

bait pricing

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15
Q

adjust price levels so the firm can increase sales volume to match organizational expense

A

survival

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16
Q

identify price and cost levels that allow the firm to maximize profit

A

profit

17
Q

identify price levels that enable the firm to yield targeted ROI

A

Return on investment

18
Q

adjust price levels so the firm can maintain or increase sales relative to competitors’ sales

A

market share

19
Q

set price levels to encourage rapid sales

A

cash flow

20
Q

identify price levels that help stabilize demand and sales

A

status quo

21
Q

set prices to recover research and development expenditures and establish a high quality image

A

product quality

22
Q

adding a dollar amount or percentage to the cost of the product

A

cost-based pricing

23
Q

establishing and adjusting prices of multiple products within a product line

A

product-line pricing

24
Q

pricing that attempts to influence a customer’s perception of price to make a product’s price more attractive

A

psychological pricing

25
Q

packaging together two or more complementary products and selling them at a single price (cable service providers)

A

bundle pricing

26
Q

packaging together two or more identical products and selling them at a single price (toothpaste, potato chips)

A

multiple-unit pricing

27
Q

pricing products low on a consistent basis (walmart)

A

everyday low prices (EDLP)

28
Q

ending the price with certain numers to influence buyers’ perceptions of the price or product ($99.95)

A

odd-even pricing

29
Q

setting prices at an artificially high level to convey prestige or a quality image (perfumes, liquor)

A

prestige pricing

30
Q

fees set by people with great skill or experience in a particular field

A

professional pricing

31
Q

a product priced below the usual markup, near cost, or below cost

A

price leaders

MKTG 321 Test 3 (3 decks)

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