Study_Guide_for_Lecture_14_-_Price_Strategy - Study guide...

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Study guide for lecture 14: Price Strategy Legal Issues 0. Price fixing 0. Horizontal price fixing 0. Sherman antitrust act 1. Temptation for oligopolies 2. Price signaling 1. Vertical price fixing 3. Consumer Goods Pricing Act 4. Manufacturers cannot dictate prices to retailers 0. MSRP 0. Price Discrimination 2. Robinson-Patman act 3. It is illegal to sell the same product to different customers at a different price 0. Unless there is an economic basis for the difference 0. Products at Costco are different that products at Safeway 1. Deceptive pricing 0. Bait and switch 1. Advertised merchandise is not available 2. Quantities limited 1. Reference pricing 3. Comparison prices 4. Have to actually sell one at that price 5. Make it clear this is not the store’s price 2. Predatory pricing 2. Selling below your cost of production in order to drive a competitor out of  business 6. Price wars Price Theory New Product Pricing 3. Three approaches to market entry 4. Skimming Marketing 431 Study Guides © 2009 Lecture 14: Price Strategy 1
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5. Charge high prices 6. Pay back development costs 7. Introductory phase of product life cycle 8. Prices drop as demand picks up and competition increases 4. Penetration 5. Charge low prices 6. Capture market share 7. Growth stage of the product life cycle 8. Discourage competition 9. Experience curve  9. Unit cost decreases 10-30% every time production doubles 10. Trial pricing 10. Pricing a new product at a low price for a limited period of time
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This note was uploaded on 05/10/2010 for the course MKTG 431 taught by Professor Brucerobertson during the Spring '07 term at S.F. State.

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Study_Guide_for_Lecture_14_-_Price_Strategy - Study guide...

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