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Penetration Pricing Strategy Essay
Penetration pricing vs skimming pricing which one is better
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The Pros And Cons Of Penetration Pricing
573 Words2 Pages
Recommended: Penetration Pricing Strategy Essay
Problem 1:
Penetration pricing is involved when a company is launching a product in a market where the product that is low priced while the company intends to secure market share. This scheme calls for extensive planning. For proper execution of the pricing scheme, the company or manufacture must be ready and willing to produce the specific product in large quantity. The company or manufacturer should also launch a big campaign that will mainly publicize the low prices of the new products. The business owner must take nit that the penetration price result in an expensive operation and the owner must be readily prepared for the cost. With a low consumer demand, the business might suffer from an accumulated stockpile of product without market and hence they become unwanted.
Price skimming is a strategy that mainly focuses on profit increase and maximization through charging high prices to the early customers of the new product. The prices is the reduced with time to attract the thriftier consumers. The reduction is mostly done after a significant amount of sale has been done. When ...
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