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Price - Coggle Diagram
Price
Penetration pricing :To establish itself in the market/get market share
Gain market share
Gain customers first, then
increase price
Attract buyers (other
businesses)
Common in mass markets
Competition-based pricing
Choosing a price based on what competitors are charging
Prices could be the same or price wars
Business compete in non-price competition
Promotions
New packaging
Better customer service
Price Skimming
Setting a high price first and then
lowering it later
Generate high revenue before
competition arrives
Target early adopters
consumers who are keen to
buy new products as soon as
they are launched
Advantages :Make costs back quickly
Segment the market
Early adopters
Brand loyalists
Regular customers
Disadvantages
Short-term benefits
Research needed
Hard to predict demand
Pricing
Destroyer/predatory pricing
setting a low price until rivals
have gone out of business
Price leader - sets the price for the
market
-Avoid price wars
-Smaller businesses accept
Cost-plus pricing :Adding a mark-up to products
% added to costs to set a price that makes a profit