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MANAGERIAL ECONOMICS LESSON 6 > PRICING STRATEGY AND REVENUE MANAGEMENT > Flashcards

PRICING STRATEGY AND REVENUE MANAGEMENT Flashcards

1
Q

the approach a business takes to set prices for its products and services.

A

PRICING STRATEGY

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2
Q

the methods and procedures companies employ to determine the rates they charge for their goods and services.

A

PRICING STRATEGY

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3
Q

is how you calculate the numbers.

A

PRICING STRATEGY

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4
Q

is the amount you charge for your items

A

PRICING

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5
Q

8 Types of Pricing Strategy

A

• COST-PLUS PRICING
• VALUE-BASED PRICING
• COMPETITOR BASED PRICING
• SIMPLE SEGMENTATION
• DYNAMIC SEGMENTATION
• PRICE SKIMMING
• ECONOMY PRICING
• PENETRATION PRICING

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6
Q

A very simple pricing strategy where you decide how much extra you will charge for an item over the cost.

A

COST-PLUS PRICING

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7
Q

Strategy that involves basing your prices on how the customer perceives the value of your product or service.

A

VALUE-BASED PRICING

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8
Q

rather than looking at the competitors or the market or the cost of the product you go directly to the source, the customer and choose a price based on what they’re willing to pay.

A

VALUE-BASED PRICING

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9
Q

Pricing model where your price points heavily influenced by those of your competitors.

A

COMPETITOR BASED PRICING

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10
Q

This approach focuses outwardly on the market, rather than inwardly in your costs (cost plus pricing).

A

COMPETITOR BASED PRICING

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11
Q

Adjusting prices to match or beat competitors in the market.

A

COMPETITOR BASED PRICING

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12
Q

Sometimes called as differentiation, is a strategy in which prices are differentiated based on the willingness to pay.

A

SIMPLE SEGMENTATION

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13
Q

It is driven by the fact that price sensitivity can vary so much from customer to customer, from product to product, and in all the locations that they use your product.

A

SIMPLE SEGMENTATION

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14
Q

It can be time-based segmented (different price for a similar product) peak, and market based. Businesses may also use a combination of these strategies.

A

DYNAMIC SEGMENTATION

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15
Q

the pricing of products or services throughout the day.

A

TIME-BASED DYNAMIC PRICING

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16
Q

changing prices in real-time based on demand, competition or other market factors.

A

DYNAMIC SEGMENTATION

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17
Q

Product pricing strategy by which a firm charges the highest initial price that customers will pay and then lowers it overtime.

A

PRICE SKIMMING

18
Q

It involves setting low prices for products with minimal production costs.

A

ECONOMY PRICING

19
Q

The aim is to capture the interest of the most price-sensitive users who respond best to offer promotion-related calls to action.

A

ECONOMY PRICING

20
Q

allows businesses to price products according to their production value because they don’t acquire the extra costs of advertising or marketing.

A

ECONOMY PRICING

21
Q

A pricing Strategy that is used to quickly gain market share by setting an initially low price to entice customers to purchase.

A

PENETRATION PRICING

22
Q

This pricing strategy is generally used by new entrants into a market.

A

PENETRATION PRICING

23
Q

an extreme form of penetration pricing.

A

PREDATORY PRICING

24
Q

a more specific and tactical approach to pricing.

A

REVENUE MANAGEMENT

25
Q

It involves optimizing pricing and inventory to maximize revenue, specially in industries with perishable or limited capacity sources.

A

REVENUE MANAGEMENT

26
Q

the strategic use of performance data local market data, competitor rates, and other applied analytics to help predict consumer demand to optimize pricing and distribution in ways that maximize revenue and profits.

A

REVENUE MANAGEMENT

27
Q

4 Components of Revenue Management

A

• DEMAND FORECASTING
• INVENTORY MANAGEMENT
• PRICING OPTIMIZATION
• OVERBOOKING

28
Q

Used to predict what customer demand will be for a product or service, with varying levels of specificity.

A

DEMAND FORECASTING

29
Q

Refers to the process of ordering, storing, using and selling a company’s inventory.

A

INVENTORY MANAGEMENT

30
Q

this includes the management of raw materials components and finish products as well as wear housing and processing of such items.

A

INVENTORY MANAGEMENT

31
Q

The practice of analyzing customer and market data to find the most optimal price point for a product or service.

A

PRICING OPTIMIZATION

32
Q

The goal is to determine the best price that will help attract the customers, maximize sales and increase profits.

A

PRICING OPTIMIZATION

33
Q

Accepting more reservations or orders than available capacity to account for no-shows and cancellations.

A

OVERBOOKING

34
Q

4 Foundations of Good Revenue Management System (RMS)

A

• INPUT ON COMPETITORS
• PRODUCT OR SERVICE VALUE ANALYSIS
• AUTOMATED ALERTS
• ROUTINE

35
Q

Competitors’ rate are critical for setting the best rate because their prices shape the overall consumers’ perception of the “true price” for a given product or service.

A

INPUT ON COMPETITORS

36
Q

A value analysis of a company’s product or service offering puts it in context among competitors by comparing its features and review against those of the competition.

A

PRODUCT OR SERVICE VALUE ANALYSIS

37
Q

once a company can visualize its value and competitive advantage, it can better position its products or services to potential customers.

A

PRODUCT OR SERVICE VALUE ANALYSIS

38
Q

Technology empowers companies and revenue managers with automation.

A

AUTOMATED ALERTS

39
Q

Modern softwares allows users to set up _______________ to support their strategy and keep it on track 24/7/365.

A

AUTOMATED ALERTS

40
Q

_______________ and habits can help unlock revenue insight. Revenue managers who follow daily _______________maintain visibility over their strategy and make tweaks when necessary to ensure the alignment between subscription strategy and how the software functions.

A

ROUTINE

MANAGERIAL ECONOMICS LESSON 6 (1 decks)

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