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Customer perception plays a significant role in these pricing strategies. In value-based pricing, the price is set based on the customer's price expectations. If customers perceive the product to be of high value, they are willing to pay more. In price skimming, a higher price is set initially and then it's brought down as the market evolves. This strategy relies on the perception of customers that the product is innovative or superior to others. In penetration pricing, a lower price is set to enter a competitive market and it's increased over time. This strategy relies on the perception of customers that they are getting a bargain.
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Cost-Plus Pricing – the process of simply calculating your costs and adding a mark-up. Competitive Pricing – the process of setting a price based on what the competitors' prices. Value-based Pricing – the process of setting a price based on the customer's price expectations. Price Skimming – the process of setting a higher price and bringing it down as the market evolves. Penetration Pricing – the process of setting a lower price to enter a competitive market and rising it with time.
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Take the most advantageous pricing approach to increase profitability of your organization. Use our Pricing Strategies presentation to outline factors...
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