Unformatted text preview: tration Setting a Low Price for a New Product in Order to “Penetrate” the Market Quickly and Deeply. Attract a Large Number of Buyers and Win a Larger Market Share. 9-16 Product Mix-Pricing
Strategies: Product Line Pricing
• Involves setting price steps between various products in a product line based on: – Cost differences between products,
– Customer evaluations of different features, and – Competitors’ prices.
9-17 Product Mix-Pricing
• OptionalProduct – Pricing optional or accessory products sold with the main product. For example: added memory on a computer • CaptiveProduct – Pricing products that must be used with the main product. For example: ink and printers
9-18 Product Mix-Pricing
• ByProduct – Pricing low
products to get rid of them and make the main product’s price more competitive.
Example: sawdust • Product Bundling – Combining several products and offering the bundle at a reduced price. Example: theater season tickets
9-19 Discount and Allowance
A d ju s tin g B a s ic P r ic e to R e w a r d C u s to m e r s
F o r C e r ta in R e s p o n s e s
C a s h D is c o u n t S e a s o n a l D is c o u n t Q u a n tity D is c o u n t T r a d e -In A llo w a n c e P r o m o tio n a l A llo w a n c e
9-20 Psychological Pricing
• Considers the psychology of •
3.00 • prices and not simply the economics.
Customers use price less when they can judge quality of a product.
Price becomes an important quality signal when customers can’t judge quality; price is used to say something about a product. 9-21 Initiating Price Changes Why?
Falling Market Share
Dominate Market Through Lower Costs Why?
Overdemand: Company Can’t Supply All Customers’ Needs
9-22 Assessing and Responding to
Competitor Price Changes 9-23...
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