Pricing Strategies

1. Loss Leader Pricing

1.1. Selling the prodcut for a loss

1.1.1. Leading to brand switching

1.1.2. In the long run the losss is made up by the consumers that switch brands

2. Price Discrimination

2.1. Selling the same prodcut or service for a different price depending on the costumer

2.1.1. In order to work:

2.1.1.1. -Some power of price setting

2.1.1.2. -Different willingness to pay by costumers

2.1.1.3. -Resale is not possible

3. Price leadership

3.1. When the leading firm in a industry is able to influence prices by the influence that they hold on the sector

4. Predatory pricing

4.1. Lowering prices in order to force a company out of business

4.1.1. Illegal in the U.S and E.U

5. Price Skimming

5.1. Set a inicial hight price

5.1.1. Increse prices when competitiros enter the market

6. Cost-Plus

6.1. Predetermined amount of profit to the cost of unit per output

7. What is Price?

7.1. Amount of money paid for a good or service

8. Penetration pricing

8.1. Set a incial "Low" price

8.1.1. Leading to bigger brand awareness

8.1.2. Rise prices once the product has done R and D for the product

8.1.2.1. This justifies the increse in price for costumers

9. Psycological pricing

9.1. Rounding numbers down

9.1.1. E.g: 500$ -----> 499.99$

9.1.2. The cosntumer thinks they are paying 400 instead of 500

9.1.2.1. It has a psycological effect on costumers making them think they are paying less