Pricing Stratagies Flashcards
what is a price taker?
when i business prices their product at the ruling price of the market
what is a price maker?
when a business makes their own prices for their products
what is a price leader?
businesses that are market leaders who’s price changes are then followed by rivals
what is a price follower?
a business that follows the price changing lead of the market leader
what is price skimming?
when a business sets the price of a product high to maximise profit
what is penetration pricing?
when a business sets the price of a product low to maximise sales
what is predatory pricing?
when a business lowers its prices to try and decrease the sales of a competetor
what are price wars?
when two businesses reduce their price to try and beat each other and secure a larger market share
what is psychological pricing?
when a business uses strange numbers in their prices to make customers think that it is chaeper
what is a loss leader?
a product that is priced below costs to the seller to try and encourage customers to buy other products from them
what is dynamic pricing?
when a business sets flexible pricing for products based on the currents demands of the market
