Sports & Entertainment Marketing Pricing Project
Melvin & Eric
Prestige Pricing is the practice of pricing goods at a high level in order to give the appearance of quality. Jewelry, paintings are a good example of goods that are priced high in order to give it a better appearasnce.
Odd and even pricing is a marketing practice based on the theory that certain prices have a psychological impact. $0.99 is an example of psychological pricing in the sense that odd numbers appeals to some customers.
Price skimming is a pricing strategy in which a marketer sets a relatively high price for a product or service at first, then lowers the price over time. This startegy is beneficial to businesses because it allows the business to make a lot of money from customers who want the new product early.
Penetration pricing is a pricing strategy where the price of a product is initially set at a price lower than the eventual market price, to attract new customers. This strategy allows for new customers to purchase the product and become familliar with the brand and it also allows for incrase in profit for the business.
The process used by retailers of separating goods into cost categories in order to create various quality levels in the minds of consumers. This strategy is used in order to convince customers that the products in different prices differ in quality.
The act of placing several products or services together in a single package and selling for a lower price. This strategy allows for businesses to sell different products and services to customers and it also attracts new customers.
A loss leader (also leader) is a pricing strategy where a product is sold at a price below its market cost to stimulate other sales of more profitable goods or services. Walmart uses this strategy because it attarcts customers to the low cost products but in the end they end up buying other products.
Yield management is the process of making frequent adjustments in the price of a product in response to certain market factors, such as demand or competition. As demand and competition increases or decreases so does the price.