Académique Documents
Professionnel Documents
Culture Documents
Understanding how
much value consumers
place on the benefits
they receive from the
product and setting a
price that captures that
value
• Rent • Fee
• Tuition • Dues
• Fare • Interest
• Rate • Donation
• Commission • Salary
• Wage
• Market-skimming
pricing
• Market-
penetration pricing
Optional- Captive-
Product
product product
line pricing
pricing pricing
Product
By-product
bundle
pricing
pricing
Pricing Strategies
Pricing Strategies
Pricing Strategies
Discount and
Segmented
allowance
pricing
pricing
Psychological Promotional
pricing pricing
Pricing Strategies
Pricing Strategies
Pricing Strategies
• Price cuts
( to boost sales
and shares)
• Price increases
Price
Price cuts
increases
• Product is “hot” • New models will
that means be available
better made • Models are not
• Company is selling well
greedy • Quality issues
Questions
– Why did the competitor change the price?
– Is the price cut permanent or temporary?
– What is the effect on market share and profits?
– Will competitors respond?
Solutions
– Reduce price to match competition
– Maintain price but raise the perceived value
through communications
– Improve quality and increase price
– Launch a lower-price “fighting” brand
Robinson-Patman Act
• Price discrimination is allowed:
– If the seller can prove that costs differ when
selling to different retailers
– If the seller manufactures different qualities
of the same product for different retailers