Explain the different strategies available to companies for setting prices.

Explain the different strategies available to companies for setting prices.



Pricing strategies fall into five categories: new-product pricing, differential pricing, psychological pricing, product-line pricing, and promotional pricing.

Price skimming and penetration pricing are two strategies used for pricing new products.

Differential pricing can be accomplished through negotiated pricing, secondary-market pricing, periodic discounting, and random discounting.

Types of psychological pricing strategies are odd-number pricing, multiple-unit pricing, reference pricing, bundle pricing, everyday low prices, and customary pricing.

Product-line pricing can be achieved through captive pricing, premium pricing, and price lining.

The major types of promotional pricing are price-leader pricing, special-event pricing, and comparison discounting.


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