Marketing Chapter 11
In the early periods of the introduction of HDTV, the prices were extremely high. The strategy being used is considered to be what?
Price skimming
Companies set not a single price, but a pricing ________ that covers different items in its line and changes over time as products move through their life cycles.
structure
Segmented pricing is only effective when ________.
the cost of segmenting does not exceed the revenue obtained from the price difference
Amazon developed the Kindle electronic book reader and sells it at a reasonably low margin. The firm uses which pricing strategy to capture additional profits through the sale of easily downloaded online books and magazines?
Captive-product pricing
Bill goes to a sporting goods store several times and spends a considerable amount of time checking out golf clubs, taking practice swings with them, and asking the sales staff questions. He compares prices, and then goes home and buys a set online at a lower price. Bill's behavior is called what?
Showrooming
Using ________ pricing, companies are able to turn their trash into cash, allowing them to make the price of their main product more competitive.
by-product
Which of the following product mix pricing strategies did Polaroid use when it set the general price range of its cameras low and the markup on its film high?
captive product pricing
Which of the following price adjustment strategies involves reducing prices to reward customer responses such as volume purchases, paying early, or participating in sales-support programs?
discount and allowance pricing
Consumers are less likely to use price to judge the quality of a product when they _________.
have experience with the product
Freight-absorption pricing is used for ________.
holding on to increasingly competitive markets
When Bic introduced disposable razors, the product and market met several criteria for using ________ pricing. The market was price sensitive, and there were substantial economies of scale in distribution and production.
market-penetration
Companies introducing a new product can choose between two broad strategies. One is market-skimming pricing. Which of the following is an alternative strategy?
market-penetration pricing
Companies that set a low price for a new product in order to attract a large number of buyers and a large market share are using the ________ strategy.
market-penetration pricing
________ allowances are payments or price reductions that reward dealers for participating in advertising and sales support programs.
promotional
Hearth & Home, a store which sells household products, has announced a one-week sale on its new carpet line. This is an example of __________.
promotional pricing
Which of the following is a price adjustment strategy that considers how a customer's perception of a product is influenced by its price?
psychological pricing
________ are formed by noting current prices, remembering past prices, or assessing the buying situation.
reference prices
By definition, ___________ pricing is used when a firm sells a product or service at two or more prices, even though the difference in price is not based on differences in costs.
segmented
The New Age Gallery has three admission prices for students, adults, and seniors, even though all three groups are entitled to the same services. This form of pricing is called ________ pricing.
customer-segment
Which of the following product mix pricing strategies involves pricing additional or accessory products sold along with the main product?
optional-product pricing
Which of the following product mix pricing strategies involves pricing products that can only be used with the main product?
captive product pricing
Which of the following would most likely lead to a company initiating a price increase?
over-demand
If Detroit DLX charges the same price for the delivery of its product to customers located in the states near the Great Lakes, but a different price to customers elsewhere, the company is using ________.
zone pricing
