4

Question 1

Price strategy is

Answer 1

how the price is set with an marketing aim in mind. E.g. price indicates value.

Question 2

PRICE STRATEGIES include

Answer 2

Penetration Pricing, Market skimming, Neutral-value pricing, Cost-plus pricing.

Question 3

Penetration Pricing

Answer 3

Prices are set low o secure high volumes.
Typical in mass market products when launching into a new market.

Question 4

Market Skimming

Answer 4

High price, low volumes.

Question 5

Neutral-value pricing

Answer 5

Price set in accordance with manufacturers perceptions about the value of the prod-uct/service. Includes target costing.

Question 6

Optional-product pricing

Answer 6

Takes into account optional or accessory products along with the main product.

Question 7

Effects to consider from consumer psychology

Answer 7

sunk cost, Halo effect, Compromise effect &The anchoring effect

Question 8

The anchoring effect

Answer 8

comparing things depending on our knowledge/anchor. It’s a cognitive bias.

Question 9

sunk cost is

Answer 9

cost that we are not able to recover.

Question 10

Halo effect is

Answer 10

the tendency to assume that if something is good on one attribute (a company product) then it is good on all others (the company’s other products).

Question 11

Compromise effect

Answer 11

When choosing between many things customer will often chose the compromise option.