Essay about Pricing Tactics

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Costs Strategies

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Pricing Tactics

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Penetration Pricing

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Penetration Prices

• Selling price set to ‘penetrate the market'

• ‘Low' price for getting high volumes of prints

• Typical in mass market items –

delicious chocolate bars, meals stuffs, household

goods, etc .

• Suited to products using firm

anticipated your life cycles

• May be valuable if releasing into a new

market

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Market Skimming

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Market Skimming

The majority are predicting a firesale in

laptops since supply is higher than

demand.

• High price, Low volumes

• Skim the money from the

industry

• Suitable for products that

have brief life cycles or

that can face

competition at some

justification in the future (e. g.

after having a patent operates out)

• Examples include:

Playstation, jewellery,

digital technology, new

Digital video disks, etc .

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Worth Pricing

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Value Charges

• Selling price set in

obedience with

customer

perceptions about

the value of the

product/service

• Examples include

position

products/exclusive

products

Companies might be able to set prices

according to perceived benefit.

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Loss Innovator

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Loss Leader

• Goods/services intentionally sold under

cost to encourage sales elsewhere

• Typical in supermarkets, elizabeth. g. at

Christmas, selling bottles of gin in £3 in

the expect that people will probably be attracted to

the store and buy other items

• Acquisitions of different items a lot more than

covers ‘loss' on item sold

• e. g. ‘Free' cellphone when signing up for

contract deal

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Emotional Pricing

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Psychological Prices

• Accustomed to play on buyer

perceptions

• Classic model - £9. 99 instead of

£10. 99!

• Links with value pricing – substantial

value products priced in accordance to

what consumers BELIEVE should be

the cost

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Going Rate (Price Leadership)

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Going Price (Price Leadership)

• In the case of price innovator, rivals have a problem in

contending on selling price – way too high and they lose

market share, lacking and the cost leader

might match value and pressure smaller competitor out

of market

• May adhere to pricing potential clients of opponents especially

exactly where those rivals have a clear dominance of

market share

• Where competition is limited, ‘going rate'

pricing may be relevant – banks, petrol,

supermarkets, electrical merchandise – discover very

similar prices in most outlets

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Tender Pricing

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Soft Pricing

• Many deals awarded over a tender basis

• Firm (or firms) submit their particular price for carrying

out the operate

• Purchaser then chooses which represents best

benefit

• Mostly done in top secret

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Cost Discrimination

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Price Discrimination

Prices for rail travel differ for the same

journey at several times of the morning

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• Charging a different

price for the same

good/service in

different market segments

• Requires each

industry to be

dense

• Needs different

value elasticity of

demand in each

market

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Destroyer Pricing/Predatory Prices

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Destroyer/Predatory Pricing

• Deliberate price cutting or offer of ‘free...

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