Marketing Pricing

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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


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