Search results
Results From The WOW.Com Content Network
Price skimming. Price skimming is a price setting strategy that a firm can employ when launching a product or service for the first time. [1] By following this price skimming method and capturing the extra profit a firm is able to recoup its sunk costs quicker as well as profit off of a higher price in the market before new competition enters and lowers the market price. [1]
In particular, the authors find five patterns: skimming (40% frequency), penetration (20% frequency), and three variants of market-pricing patterns (60% frequency), where new products are launched at market prices. Skimming pricing launches the new product 16% above the market price and subsequently increases the price relative to the market price.
Price proportion cost: The price proportion cost refers to the percent of the total cost of the end benefit accounted for by a given component that helps to produce the end benefit (e.g., think CPU and PCs). The smaller the given components share of the total cost of the end benefit, the less sensitive buyers will be to the components' price.
A loss leader (also leader) [1] is a pricing strategy where a product is sold at a price below its market cost [2] to stimulate other sales of more profitable goods or services. With this sales promotion / marketing strategy, a "leader" is any popular article, i.e., sold at a low price to attract customers.
Predatory pricing is a commercial pricing strategy which involves the use of large scale undercutting to eliminate competition. This is where an industry dominant firm with sizable market power will deliberately reduce the prices of a product or service to loss-making levels to attract all consumers and create a monopoly. [1]
BBC Bitesize, [1] also abbreviated to Bitesize, is the BBC's free online study support resource for school-age pupils in the United Kingdom. It is designed to aid pupils in both schoolwork and, for older pupils, exams .
Fractional prices suggest to consumers that goods are marked at the lowest possible price. When items are listed in a way that is segregated into price bands (such as an online real estate search), price ending is used to keep an item in a lower band, to be seen by more potential purchasers. The theory of psychological pricing is controversial.
The Robinson–Patman Act (RPA) of 1936 (or Anti-Price Discrimination Act, Pub. L. No. 74-692, 49 Stat. 1526 (codified at 15 U.S.C. § 13)) is a United States federal law that prohibits anticompetitive practices by producers, specifically price discrimination.