Price
price refers to the amount paid by a customer to purchase a good or service
it is a very important part of marketing strategies. Determines whether a product will sell or not
cost up pricing or mark up pricing
involves adding a percentage or predetermined amount of profit to the cost per unit output to determine the selling price
loss leader pricing
involves setting a price of a product below the its cost of production
the purpose into entice customers to but products with hight profit margins in addition to purchasing a product of loss leader
mark up
refers to the extra amount charged by a business on top of its units cost of production to earn a profit margin
non- pricing strategies
can be both % and absolute amount
method used by a business to market its product other than the price factor
eg- advertising
penetration pricing
setting low prices to gain entry into new markets
once the product is known they can increase the price
price discrimination
charging different prices to different group of customers for the same product
predatory pricing
temporarily setting very low prices that rivals (small businesses) can't compete at a profitable level
price leadership
price skimming
used for selling best selling products or brand in a particular market
customer perceive there aren't many substitutes for the products dominant firms set their own price for it
competitors set their price prices based on the price market
involves initially charing high prices for high tech products
price is reduced as novelty wears off and substitute products are made
pscyhological pricing
involves rounding down numbers to make the prices look lower
eg-999