Ch.9 MML
What are the three major pricing strategies used by marketers?
-customer value based pricing - cost based pricing -competition based pricing
What are the five product mix pricing situations?
-product line pricing -optional product pricing -captive product pricing - by-product pricing -product bundle pricing
Which of the following statements is true regarding initiating price increases?
Wherever possible, the company should consider ways to meet higher costs or demand without raising prices.
Which of the following is a cost-oriented pricing approach?
breakeven pricing
Gillette charges a fairly low price for its razors (relative to costs) and a high price for razor blades. It is using a strategy of ___________ pricing.
captive-product
Printer companies often charge a fairly low price for their ink jet printers (relative to costs) and a high price for replacement cartridges. These companies are using a strategy of ________ pricing.
captive-product
The price ceiling, the maximum price a company can charge, is set by ________.
customer perceptions of the product's value
________ refers to setting price based on buyers' perception of value rather than on the seller's cost.
customer value-based pricing
Which of the following statements is true regarding initiating price cuts?
cutting prices in an industry loaded with excess capacity might lead to price wars
Which of the following is a potentially effective action a company could take in response to a competitor's price cut?
increase both price and quality
Many state colleges and universities charge one price for in-state students and a higher price for out-of-state students. Which form of segmented pricing are these schools using?
location-based pricing
When Apple Computer Company introduced its iPhone, its priced the new product at $599, considerably higher than either their iPod or competing cellular phones. Apple Computer was pursuing a ___________________ new product pricing strategy.
market skimming
A company has set a low price on a new product it introduced. It wants to maximize its market share and attract a large number of buyers quickly. Which new product pricing strategy should the company use?
market-penetration pricing
When a company sets a high price as the initial price of a new product, it is pursuing a ________ new product pricing strategy.
market-skimming
Dynamic pricing is when companies continually adjust prices to meet the characteristics and needs of individual customers and situations. Where is this method especially prevalent today?
online buying
A car buyer can choose a base model at one price, or one with a premium sound and navigation system at a higher price. This is an example of _______ pricing.
optional-product
Which of the following statements is true regarding how price might play an important role in helping to accomplish company objectives?
pricing can create excitement for a brand
Bath & Body Works offers "three-fer" deals on its soaps and lotions (such as three antibacterial soaps for $10). This is an example of _______ pricing.
product-bundle
Companies that use ________ continually adjust prices to meet the characteristics and needs of individual customers and situation
psychological pricing
Many state colleges and universities charge one price for in-state students and a higher price for out-of-state students. Which price adjustment strategy are these schools using?
segmented pricing
Geared2Beer, a craft beer brand, identifies a market segment that is willing to pay premium prices for its craft beer, and Geared2Beer managers select an ideal selling price. Managers then determine the costs to create craft beer that meets the ideal selling price. The company's pricing approach is referred to as ________.
target costing
Internal factors that affect pricing include ________.
the company's overall marketing strategy, objectives, marketing mix, and other organizational considerations.
New, premium movie theaters offer features such as online reserved seating, high-backed leather executive chairs with armrests and footrests, the latest in digital sound, super-wide screens, and other amenities for which they charge a higher price. This is an example of which type of pricing?
value-added pricing
One major objective associated with a market-penetration pricing strategy is to ________.
win a large market share
