CH14_price.ppt - FIGURE 14-2 Four approaches for selecting an approximate price level 14-2 STEP 4 SELECT AN APPROXIMATE PRICE LEVEL DEMAND-ORIENTED

CH14_price.ppt - FIGURE 14-2 Four approaches for selecting...

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FIGURE 14-2FIGURE 14-2Four approaches for selecting an approximate price level 14-2
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STEP 4: SELECT AN APPROXIMATE PRICE LEVEL DEMAND-ORIENTED PRICING APPROACHES Skimming Pricing Penetration Pricing Prestige Pricing Price Lining 14-3
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Skimming Pricing Skimming pricing is used when introducing a new or innovative product, and involves setting the highest initial price that customers really desiring the product are willing to pay. 14-4
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Penetration Pricing Penetration pricing involves setting a low initial price on a new product to appeal immediately to the mass market. 14-5
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FIGURE 14-3 FIGURE 14-3 Demand curves for two demand-oriented pricing approaches 14-6
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STEP 4: SELECT AN APPROXIMATE PRICE LEVEL DEMAND-ORIENTED PRICING APPROACHES Bundle Pricing Yield Management Pricing Odd-Even Pricing Target Pricing 14-7
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Odd-Even Pricing Odd-even pricing involves setting prices a few dollars or cents under an even number. Gillette fusion $11.99 14-8
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14-9 - to-india-analyst.html
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Bundle Pricing Bundle pricing involves the marketing of two or more products in a single package price. 14-10
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14-11
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14-12 - cheaper price, if all items are combined - More value - Saving time - More items sold - Increase turnover - More sales/revenue - Faster ordering process. - Retain customers - Higher profit margin
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Yield Management Pricing Yield management pricing involves the charging of different prices to maximize revenue for a set amount of capacity at any given time. Commonly used by airlines 14-13
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STEP 4: SELECT AN APPROXIMATE PRICE LEVEL COST-ORIENTED PRICING APPROACHES Standard Markup Pricing Cost-Plus Pricing Experience Curve Pricing Cost-Plus Percentage- of-Cost Pricing Cost-Plus Fixed-Fee Pricing 14-14
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