CHAPTER 10 Flashcards
PRICING PRODUCTS AND SERVICES - Know basic pricing terminology - Understand the general approaches to setting prices - Understand the psychological aspects of pricing - Create a general price range for a good or service
Who said “Price is what you pay, value is what you get?”
Warren buffet
Warren Buffet said, _____ is what you pay, ______ is what you get
price, value
What causes one company to set the price of a limited-edition pencil at $10,000 and another company to price pencils at a penny for a pack of ten? What causes customers to purchase one of these and not the other?
the answers lie in pricing strategies and the psychology behind them
What is operating profit?
revenue minus the cost of goods sold, the operating expenses, depreciation, amortization
what are two questions marketers struggle with?
How do we know the correct price for this item?
How do we know what this is worth to the consumer?
What happens if a companies products are too high?
customers won’t buy the product
What happens if a companies products are too low?
the company either doesn’t make money or it leaves potential revenue on the table
Customers look to price to help decide which brands are ______.
trustworthy
