Marketing Mix - Price Flashcards
What is the price of a product affected by?
7PS
What is cost-plus pricing?
When price is set to cover the cost of making the product or buying from a wholesaler and to make a profit
What is price skimming?
When new products are sold at high prices when they first reach the market. Consumers will pay more and then prices are dropped.
What is an example of a company that uses price skimming?
Apple
What is penetration pricing?
Launching a product at low price in order to attract customers and gain market share.
What does penetration pricing work best for?
Companies that benefit from lower costs
What is a problem with penetration pricing?
Customers could expect price to stay low
What is predatory pricing?
When a business deliberately lowers prices to force another business out of market
What is competitive pricing?
When companies monitor their competitors prices to make sure prices are set at an equal or lower level.
What is psychological pricing?
Bases the price on customers expectations
What is loss leader pricing?
Products sold at or below cost price
What is price discrimination?
When a company sells its product at different prices to different groups of consumers
What is dynamic pricing?
To increase revenue by changing prices depending on competitor prices and demand
What influences pricing in industrial marketing?
Depends on the competitiveness of the market
