Price Flashcards
1
Q
what is effective about a decrease in price
A
makes the product more affordable and helps increase sale volume
2
Q
what is effective about an increase in price
A
it will promote an exclusive image and possibly increase profits
3
Q
what consequences can there be if the prices are chosen incorrectly
A
- loss of customers as the price is too high
- loss of revenues fewer customers means less sales
4
Q
what is a price strategy
A
it is your price compared to competitors set over long term
5
Q
what is a price tactic
A
it is a change in price in the short term, to influence demand
6
Q
what are long term pricing strategies
A
- low price is used in competition and sets price below rivals
- high price is used in competition and sets price above rival
- phsychological price strategy used as long term (£99 not £100)
7
Q
what are some short term pricing tactics
A
- skimming is a high price at launch then lowers
- penetration is low at launch then increase
- loss leader is very low price or deals to encourage retailers
