Marketing Pricing
psychological pricing techniques (definition)
attempts to influence a customers perception of price to make the products price more attractive
New product pricing (examples)
Price Skimming Penetration pricing
price discount categories
trade quantity cash seasonal allowance
Negotiated pricing
Final price established through buyer/seller bargaining
random discounting pricing
unsystematic temporary price reductions
external reference price
a comparison price provided by others
allowance
a concession in price to achieve a desired goal
internal reference price
a priced developing in the buyers mind through experience with product
special event pricing
advertised sales or price cutting is used to increase sales volume and is linked to a holiday, a season, or other event
cumulative discounts
aggregated over a stated time period (coffee cards)
price fixing
an agreement between two or more firms on the price they will charge for a product
captive pricing
basic product in a product line is prices low while required related items are priced higher
non-cumulative discounts
buy 6 get 1 free
product-line pricing strategies (examples)
captive pricing premium pricing bait pricing price lining
predatory pricing
charging a very low price for a product with intent of driving competitions out of business or out a market
differential pricing (definition)
charging different prices to different buyers for the same quality and quantity
price skimming
charging the highest possible price that buyers who most desire the product will pay
value conscious buyers
concerned about both price and quality of a product
odd-even pricing
ending the price with certain numbers that influence buyers perceptions of the price
Product line pricing strategies (definition)
establishing and adjusting prices of multiple products within a product line (the goal is to maximize profits for an entire product line)
prestige sensitive buyers
focus on products that signify prominence and status
premium pricing
giving the highest quality products a line the highest prices
unfair trade practice acts
laws that prohibit wholesalers and retailers and retailers from selling below cost
price lining
limited the number of prices for selected lines of merchandise
bait pricing
low pricing on one item in a line with the intention of selling higher priced items in the line
Differential pricing (examples)
negotiated pricing secondary market pricing periodic discounting pricing random discounting pricing
secondary market pricing
one price for primary target market and a different price for another market
bundle pricing
packaging complementary products to be sold at a single price
multiple unit pricing
packaging together two or more identical products to be sold at a single price
professional pricing
used by people with great ill or experience in a field or activity. professionals have an ethical responsibility not to overcharge customers
reference pricing
positioning a moderately priced item next to a more expensive brand to make it seem lower in price
promotional pricing (definition)
price is often coordinated with promotion
promotional pricing (examples)
price leader special event pricing comparison discounting
seasonal discount
price reduction given to buyers for purchasing goods or services out of season
cash discounts
price reductions given to buyers for prompt payment or cash payment
customary pricing
pricing certain goods on the basis of tradition
price leader
products priced below the usual markup, near cost, or below cost. management hopes sales of regularly priced merchandise will offset the reduced revenues from the price leaders
quantity discount
reduction from list price for purchasing in large quantities (put bike together)
trade functional discounts
reduction off list price a producer gives for performing certain functions
psychological pricing techniques
reference pricing bundle pricing multiple unit pricing everyday low prices odd-even pricing customary pricing prestige pricing
everyday low prices
setting a low price on products on a consistent basis
prestige pricing
setting prices at an artificially high level to convey prestige or high quality
penetration pricing
setting the price below competing brands to penetrate a market and gain market shares quickly
new product pricing (definition)
setting the price for new products is one of the most fundamental decisions in the marketing mix
selling against the brand
stocking well known branded items at high prices in order to sell store brands at discounted prices
price conscious buyers
strive to always pay low prices
periodic discounting pricing
systematic or patterns temporary price reductions
comparison discounting
the pricing of a product at a specific level and simultaneously comparing it to a higher price