Marketing Chpt 13

strategy
Broad set of organizational plans for implementing the decisions made for achieving organizational goals
price competition
Competition focused on the selling price of a product.
value pricing
a pricing strategy in which the target market is offered a high-quality product at a fair price and with good service.
nonprice competion
a way to attract customers through style, service, or location, but not a lower price
market-skimming pricing
Setting a relatively high initial price for a new product
market-penetration pricing
Setting a low price for a new product
predatory pricing
Practice of pricing to drive current competitors out of business and to discourage new entrants in a market so that a firm can enjoy future profits
quantity discount
price reductions granted for large volume purchases
noncumulative discount
A one-time price reduction based on the number of units purchased, the size of the order, or the product combination purchased.
cumulative discount
A quantity discount aggregated over a stated period.
trade discount
also known as a functional discount, a reduction of the list price given by a producter to an intermediary for performaing certain functions
cash discount
A deduction that a vendor allows on the invoice amount to encourage prompt payment
rebate
A partial refund of the original price of the product
price customization
Establishes various prices on the basis of how much value is attached to a product by different people
seasonal discount
a price reduction for buying merchandise out of season
promotional allowance
A price reduction granted by a seller as payment for promotional services performed by buyers
price discrimination
when a business sells the same product to different people at different prices
FOB factory pricing
Geographic pricing strategy in which the seller does not pay any of the freight costs.
uniform delivered pricing
A price tactic in which the seller pays the actual freight chargers and bills every puchaser an identical, flat freight charge.
zone-delivered pricing
Divides a seller’s market into a limited number of broad geographic zones and then sets a uniform delivered price for each zone.
freight-absorption pricing
A manufacturer quotes to the customer a delivered price equal to its factory price plus the shipping cost that would be charged by a competitive seller located near that customer
one-price strategy
Seller charges the same price to all similar customers who buy identical quantities of a product
flexible-price strategy
also called variable-price strategy, similar customers may pay different prices when buying identical quantities of a product
flat-rate pricing
Purchaser pays a stipulated single price and the can consume as little or as much of the product as desired
single-price strategy
All items are sold for the same price. Ex. Dollar Store
price lining
Retailers frequently offer a limited number of predetermined price points within a merchandise category. Ex. $69.99, $89.99, and $129.99
odd pricing
the practice of ending prices in numbers below even dollars and cents in order to create a perception of greater value
leader pricing
involves a retailer pricing certain items lower than normal to increase customers’ traffic flow or boost sales of complementary products.
loss leader
an item priced at or below cost to draw customers into a store.
high-low pricing
Strategy that entails alternating between regular and sale prices on the most visible prices
everyday low pricing
setting prices lower than competitors and then not having any special sales.
resale price maintenance
the situation in which a producer sets a list price and does not allow the retailer to offer a discount to consumers.
suggested list price
Price set by a manufacturer at a level that provides retailers with normal markups
price war
successive price cutting by competitors to increase or maintain their unit sales or market share