TR Chapter 19 - Copyright 2007 by Nelson, a division of...

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Unformatted text preview: Copyright 2007 by Nelson, a division of Thomson Canada Limited . Chapter 19 Chapter 19 Pricing Strategies Pricing Strategies 19-2 Copyright 2007 by Nelson, a division of Thomson Canada Limited Chapter Objectives Chapter Objectives 1. Compare the alternative pricing strategies and explain when each strategy is most appropriate. 2. Describe how prices are quoted. 3. Identify the various pricing policy decisions that marketers must make. 4. Relate price to consumer perceptions of quality. 5. Contrast competitive bidding and negotiated prices. 6. Explain the importance of transfer pricing. 7. Compare the three alternative global pricing strategies. 8. Relate the concepts of cannibalization, bundle pricing, and bots to online pricing strategies. 19-3 Copyright 2007 by Nelson, a division of Thomson Canada Limited Pricing Strategies Pricing Strategies Skimming pricing strategy Skimming pricing strategy : involves the use of a high price relative to competitive offerings Often used by marketers of high-end products Also by firms introducing a distinctive good with little or no competition Allows firms to control demand during the introductory stages of a products life cycle Can be used as a tool for segmenting a products market on a price basis 19-4 Copyright 2007 by Nelson, a division of Thomson Canada Limited Penetration pricing strategy Penetration pricing strategy : involves the use of a relatively low entry price as compared with competitive offerings; based on the theory that this initial low price will help secure market acceptance Designed to generate many trial purchases Everyday low pricing (EDLP): Everyday low pricing (EDLP): Pricing strategy of continuously offering low prices rather than relying on such short term price cuts as cents-off coupons, rebates, and special sales Competitive Pricing Strategy Competitive Pricing Strategy : reduces emphasis on price as a competitive variable by pricing goods at the general level of competitors 19-5 Copyright 2007 by Nelson, a division of Thomson Canada Limited Price Quotations Price Quotations List prices List prices : Established prices normally quoted to potential buyers Market price Market price : Price that an intermediary or final consumer pays for a product after subtracting any discounts, rebates, or allowances from the list price 19-6...
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This note was uploaded on 02/06/2011 for the course ADMS 2200 taught by Professor Lao during the Spring '10 term at York University.

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TR Chapter 19 - Copyright 2007 by Nelson, a division of...

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