Penetration Pricing

Marketing mix - McCarthy's Four Ps 1 When setting a price, the marketer must be aware of the customer perceived value for the product. Three basic pricing strategies are: market skimming pricing, market penetration pricing and neutral pricing. The 'reference value' (where the consumer refers to the prices of competing products) and the 'differential value' (the consumer's view of this product's attributes versus the attributes of other products) must be taken into account.

Pricing - Elements of pricing 1 Do you use a price skimming strategy or a penetration pricing strategy?

Pricing - Demand-based pricing 1 Demand-based pricing is any pricing method that uses consumer demand - based on perceived value - as the central element. These include price skimming, price discrimination and yield management, price points, psychological pricing, bundle pricing, penetration pricing, price lining, value-based pricing, geo and premium pricing.

Marketing strategy - Types of strategies 1 "With skimming, a firm introduces a product with a high price and after milking the least price sensitive segment, gradually reduces price, in a stepwise fashion, tapping effective demand at each price level. With penetration pricing a firm continues its initial low price from introduction to rapidly capture sales and market share, but with lower profit margins than skimming" (37).

Criticism of Apple Inc. - Price reductions 1 is known as Penetration Pricing.

Comparison of statistical packages - General information 1 indicates that lower/penetration pricing is offered to academic purchasers

Competitor analysis - Media scanning 1 It might also indicate a new pricing|pricing strategy such as penetration pricing|penetration, price discrimination, price skimming, product bundling, joint product pricing, discounts, or loss leaders

Penetration pricing 1 Penetration pricing is most commonly associated with a marketing objective of increasing market share or sales volume, rather than to make profit in the short term.[ /penetration-pricing.asp#axzz2ETtC9KCQ Penetration Pricing] The price will be raised later once this market share is gained.

Penetration pricing - Motivation 1 The advantages of penetration pricing to the firm are:[ Pricing-Strategy-Toolkit-with-Excel- Model.php Pricing Strategy Toolkit (with Excel Model)][ etration-pricing/ Penetration Pricing]

Penetration pricing - Motivation 1 Some commentators claim that penetration pricing attracts only the switchers (bargain hunters), and that they will switch away as soon as the price rises

Penetration pricing - Motivation 1 Taken to the extreme, penetration pricing is known as predatory pricing, when a firm initially sells a product or service at unsustainably low prices to eliminate competition and establish a monopoly. In most countries, predatory pricing is antitrust|illegal, although it can be difficult to differentiate illegal predatory pricing from legal penetration pricing.

Market skimming - Limitations of price skimming 1 Penetration pricing is a more suitable strategy in this case

Standardized - Effect on Consumers 1 Another downside is that if a standard is agreed upon before products are available in the market, then consumers are deprived of the penetration pricing that often results when rivals are competing to rapidly increase market share in an attempt to increase the likelihood that their product will become the standard

EasyInternetcafé - EasyEverything 1 The business was launched in 1999 with the name 'easyEverything'. The company built yield management into its business system and adapted this to a penetration pricing strategy to build location, brand and product awareness. In several European countries it was able to build upon some degree of brand awareness created by the marketing activities of its sister company, the airline EasyJet.

China Cola - China 1 Its penetration pricing made it an affordable alternative to its rivals, particularly in the more price-sensitive rural areas.GCB_China, Danone Dump could mean Chance for Chinese Cola Brand, Goldenchinabrands.com, May 25, 2008, Retrieved

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