Pricing strategies

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Cost plus pricing
This involves setting a price by calculating the average cost of producing goods and adding a mark-up for profit
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Price discrimination
charge different market segments different prices for IDENTICAL products. I.e student discounts or tickets costing more at peak times
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Psychological pricing
Charging a little lower than a round figure i.e £9.99
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Going rate pricing
when businesses are reluctant to start a price war by lowing prices. They examine competitors prices and choose a price broadly in line with it
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Closed bid pricing
when firms have to TENDER a bid for work, which they are going to carry out.
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penetration pricing
used by businesses to gain foothold in the market, usually with new products. Pricing products at a LOW price so that retailers and consumers are encouraged to purchase the product in large quantities.
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Market skimming
Charging a High price for a new product for a limited time. Aim is to gain as much profit as possible while it remains unique to the market.
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Loss Leaders
These are products priced at very low levels in order to attract customers.
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Other cards in this set

Card 2

Front

Price discrimination

Back

charge different market segments different prices for IDENTICAL products. I.e student discounts or tickets costing more at peak times

Card 3

Front

Psychological pricing

Back

Preview of the front of card 3

Card 4

Front

Going rate pricing

Back

Preview of the front of card 4

Card 5

Front

Closed bid pricing

Back

Preview of the front of card 5
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