Pricing Strategies Flashcards
1
Q
Define Market Skimming
A
Highest possible price to earn high profit, gradually decreases
2
Q
What is penetration pricing?
A
Very low price to generate high volume sales
3
Q
Premium pricing?
A
Price higher than competitors, sets value of product
4
Q
Competiton pricing
A
High degree of competitors, better price than competitors
5
Q
Cost pricing
A
% mark up to production costs
6
Q
Loss leader
A
Product offered at a significant discount, customers purchase items not discounted
7
Q
Psychological pricing
A
Products discounted at an odd number e.g. $1.99, also higher price higher quality e.g. Gucci
8
Q
Dynamic Pricing
A
Prices fluctuate, raise price when in high demand, low price is unpopular times to generate sales
