Advertisements
Advertisements
Question
______ price refers to the high initial price charged when a new product is introduced in the market.
Options
Premium
Penetration
Skimming
None of these
Advertisements
Solution
Skimming price refers to the high initial price charged when a new product is introduced in the market.
Explanation:
Skimming pricing is a strategy where a high initial price is set for a new product to maximize profits from segments of the market willing to pay the premium price. Over time, the price is gradually reduced to attract more price-sensitive customers. This approach helps companies recover their development costs quickly and target consumers who perceive the product as valuable and are willing to pay more for it.
APPEARS IN
RELATED QUESTIONS
Which pricing strategy involves charging according to their competitors?
Markup pricing is also called as ______.
______ is the most common method used for pricing.
Setting a price below than that of the competition is called ______.
Under this Pricing Strategy, a business firm adjusts its own price policy in accordance with general pricing structure in the industry.
The main aim of penetrating pricing is to ______.
The pricing strategy involves charging according to what competitors are charging ______.
Give two conditions under which parity pricing is desirable.
Skimming pricing policy is ideal for introducing a product in the FMCG sector. Justify for or against.
Identify two desirable conditions under penetrating pricing.
