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PRICING

Company earns revenues by charging a price from buyers . Price: Value that the company expects to get from customers in return of the product or the service the company is providing to the customer. Pricing should not be treated in isolation.

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PRICING

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  1. Company earns revenues by charging a price from buyers . Price: Value that the company expects to get from customers in return of the product or the service the company is providing to the customer. Pricing should not be treated in isolation. Blend with other elements of marketing strategy to form a coherent mix that provides superior customer value Price part of positioning strategy since it sends quality cues to customer PRICING

  2. NEW PRODUCT PRICING STRATEGIES Market-Skimming Pricing: • Setting a high price for a new product to skim maximum revenues layer by layer from segments willing to pay the high price. Market-Penetration Pricing: • Setting a low price for a new product in order to attract a large number of buyers and a large market share.

  3. PRODUCT MIX PRICING STRATEGIES WHAT IS PRODUCT MIX ? The variety of product lines that a company produces or that a retailer stocks. It is sometimes called “Product Assortment”. 3

  4. Product Line Pricing Setting price steps between product line items. Optional-Product Pricing Pricing optional or accessory products sold with the main product 4

  5. By-Product Pricing Pricing low-value by-products to Cover the cost of storing and delivering them. Product Bundle Pricing Pricing bundles of products sold together

  6. Price Adjustment Strategies • Discount / allowance • Segmented • Psychological • Promotional • Geographical • International

  7. PRICE CHANGE • Companies often face situations in which they must initiate price changes or respond to price changes by competitors. • Initiating Price Cuts Initiating Price Increases

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