Pricing Strategies
Let us now understand the various pricing strategies −Skimming Pricing
In this method, a new product is introduced in the market with high price, concentrating on upper segment of the market who are not price sensitive, and the result is skimmed.
Penetration Pricing
In penetration pricing, a product is introduced in the market with a low initial price. The price is kept low to increase target consumer. Using this strategy, more consumers can be penetrated or reached.
Discounts and Allowances
Discounts are provided in order to increase the demand of product in the market. The main points to be considered to offer discounts are as follows −
#Discount in quantity
#Discount in trade
#Discount in cash
#Other discounts like seasonal, promotional, etc.
#Geographic Pricing Strategies
#Geographic pricing strategy is used to price product as per its geographical location. As the distance increases from the point of production, the cost of the product increases.
The main points to be considered under this are as follows −
#Point of production pricing strategy
#Uniform delivery pricing strategy
#Zone delivery pricing strategy
#Freight absorption pricing strategy
#Special Pricing Strategies
Special pricing strategy is mostly used for the promotion of the product. In this strategy, pricing is changed for a short interval of time. These strategies can be lined up as follows −
One price strategy
#Flexible price strategy
#Flat rate pricing strategy
#Single price strategy
#Odd pricing
#Leader pricing
#High low pricing
#Resale price maintenance
#Everyday low pricing
#Price lining
Source: https://www.tutorialspoint.com/marketing_management/marketing_management_pricing_decision.htm