Pricing Strategies

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  • Pricing Strategies
    • Penetration Pricing
      • Initially starting with a low price to attract customers
    • Competition-based Pricing
      • Sets the price below competitors - gaining additional sales
    • Cost Plus Pricing
      • % mark up - direct cost plus an amount to cover indirect costs.
    • Skimming
      • Starting off with a high which may eventually reduce.
    • Market-based Pricing
      • 'Going-rate pricing'
        • i.e. Supply and Demand set the price in the Housing market
    • Premium Pricing/ Prestige Pricing
      • High Price set to indicate an image of high quality
    • Psychological Pricing
      • Setting prices that sound less than it really is
        • i.e. iPad Air was originally priced £529.99
    • Promotional Pricing
      • BOGOF, Price reductions, 3 for 2, Loss leader
    • Price Discrimination
      • Charging different prices for the same product/service within different markets.
        • i.e. Plane tickets rise the closer to the date it gets
    • Predatory Pricing
      • Pricing so low to undercut new entrants and convince them to sell or leave the market.
  • Charging different prices for the same product/service within different markets.
    • i.e. Plane tickets rise the closer to the date it gets

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