This is a no frills low price. The cost of marketing and manufacture are kept at a minimum.Supermarkets often have economy brands for soups, spaghetti, etc.
Charge a high price because you have a substantial competitive advantage. However, theadvantage is not sustainable. The high price tends to attract new competitors into the market, andthe price inevitably falls due to increased supply. Manufacturers of digital watches used askimming approach in the 1970s. Once other manufacturers were tempted into the market andthe watches were produced at a lower unit cost, other marketing strategies and pricingapproaches are implemented.Premium pricing, penetration pricing, economy pricing, and price skimming are the four main pricing policies/strategies.
They form the bases for the exercise
. However there are other important approaches to pricing, which are as under:
Psychological Pricing , Product Line Pricing, Optional Product Pricing, Captive ProductPricing, Product Bundle Pricing, Promotional Pricing, Geographical Pricing, ValuePricing.
For many a
is simply the tangible, physical entity that they may be buying or selling.You buy a new car and that's the product - simple! Or maybe not. When you buy a car, is the product more complex than you first thought? For many a product is simply the tangible, physical entity that they may be buying or selling. You buy a new car and that's the product -simple! Or may be not when you buy a car, is the product more complex than you first thought?In order to actively explore the nature of a product further, lets consider it as three different products - the
product, and finally the
product is NOT the tangible, physical product. You can't touch it. That's because thecore product is the BENEFIT of the product that makes it valuable to you. So with the car