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Definition
| the amount of money charged for a product or service, or the sum of the values that customers exchange for the benefits of having or using the product or service |
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| customer value-based pricing |
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Definition
| setting price based on buyers' perceptions of value rather than on the seller's cost |
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Definition
| offering just the right combination of quality and good service at a fair price |
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Definition
| attaching value-added features and services to differentiate a company's offers and charging higher prices |
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Definition
| setting prices based on the costs for producing, distributing, and selling the product plus a fair rate of return for effort and risk |
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Definition
| costs that do not vary with production or sales level |
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Definition
| costs that vary directly with the level of production |
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Definition
| the sum of the fixed and variable costs for any given level of production |
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| cost-plus pricing (markup pricing) |
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Definition
| adding a standard markup to the cost of the product |
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| break-even pricing (target return pricing) |
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Definition
| setting price to break even on the costs of making and marketing a product, or setting price to make a target return |
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Term
| competition-based pricing |
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Definition
| setting prices based on competitors' strategies, prices, costs, and market offerings |
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Definition
| pricing that starts with an ideal selling price, then targets costs that will ensure that the price is met |
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Definition
| a curve that shows the number of units the market will buy in a given time period, at different prices that might be charged |
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Definition
| a measure of the sensitivity of demand to changes in price |
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Term
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Definition
| setting a high price for a new product to skim maximum revenues layer by layer from the segments willing to pay the hight price; the company makes fewer but more profitable sales |
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| market-penetration pricing |
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Definition
| setting a low price for a new product in order to attract a large number of buyers and a large market share |
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Term
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Definition
| setting the price steps between various products in a product line based on cost differences between the products , customer evaluations of different features, and competitors' prices |
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Definition
| the pricing of optional or accessory products along with a main product |
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Definition
| setting a price for products that must be used along with a main product, such as blades for a razor and games for a videogame console |
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Definition
| setting a price for by-products in order to make the main product's price more competitive |
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Definition
| combining several products and offering the bundle at a reduced price |
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Definition
| a straight reduction in price on purchases during a stated period of time or of larger quantities |
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Term
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Definition
| promotional money paid by manufacturers to retailers in return for an agreement to feature the manufacturer's products in some way |
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Term
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Definition
| selling a product or service at two or more prices, where the difference in prices is not based on differences in costs |
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Definition
| pricing that considers the psychology of prices and not simply the economics; the price is used to say something about the product |
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Definition
| prices that buyers carry in their minds and refer to when they look at a given product |
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Term
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Definition
| temporarily pricing products below the list price, and sometimes even below cost, to increase short-run sales |
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Term
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Definition
| adjusting prices continually to meet the characteristics and needs of individual customers and situations |
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