Marketing Ch.19

list price

Established price normally quoted to potential buyers.

market-plus pricing

Intentionally setting a relatively high price compared with the prices of competing products; also known as skimming pricing.

competitive bidding

Inviting potential suppliers to quote prices on proposed purchases or contracts.

cannibalization

Loss of sales of an existing product due to competition from a new product in the same line.

bundle pricing

Offering two or more complementary products and selling them for a single price.

market price

Price a consumer or marketing intermediary actually pays for a product after subtracting any discounts, allowances, or rebates from the list price.

cumulative quantity discount

Price discount determined by amounts of purchases over stated time periods.

FOB origin-freight allowed (freight absorbed)

Price quotation system that allows the buyer to deduct shipping expenses from the cost of purchases.

FOB (free on board) plant (FOB origin)

Price quotation that does not include shipping charges.

cash discount

Price reduction offered to a consumer, business user, or marketing intermediary in return for prompt payment of a bill.

competitive pricing strategy

Pricing strategy designed to deemphasize price as a competitive variable by pricing a good or service at the level of comparable offerings.

everyday low pricing (EDLP)

Pricing strategy of continuously offering low prices rather than relying on such short-term price cuts as cents-off coupons, rebates, and special sales.

loss leader

Product offered to consumers at less than cost to attract them to stores in the hope that they will buy other merchandise at regular prices.

bot (shopbot)

Software program that allows online shoppers to compare the price of a particular product offered by several online retailers.

allowance

Specified deduction from list price, including a trade-in or promotional allowance.

basing-point pricing

System used in some industries during the early 20th century in which the buyer paid the factory price plus freight charges from the basing-point city nearest the buyer.

leader pricing

Variant of loss-leader pricing in which marketers offer prices slightly above cost to avoid violating minimum-markup regulations and earn a minimal return on promotional sales.