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Created by james.bowditch
about 11 years ago
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Question | Answer |
Survival | When the organisation is in a position of sink or swim. Prices are reduced often to levels below cost to maintain sufficient flow of cash |
ROI | Significant level of return |
Market Stabilisation | Reduce leader retaliation |
Maintenance and improvement of market position | Defending current position and gradually increasing market share |
Meeting or following competitors | Entering companies into a market might take its lead in pricing from others until it is further established |
Pricing to reflect product differentiation | Pricing to create different perceptions of the products value and indirectly increase profits |
Market Skimming | Entering the market with a high price and gradually lowering |
Market Penetration | Adopting a far more aggressive approach in which prices are set deliberately low to ensure a high level of sales |
Early cash recovery | High cash flow leading to an early recovery of cash |
Discouraging others from entering the market | Deliberately setting a low price so that returns are low which simultaneously sends out signals about a willingness to engage in a price war with any new entrants |
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