Sports & Entertainment Marketing Pricing Project
Adina A. and Sarah S.
Pricing in the Sporting and Entertaining Industry.
Prestige pricing is where products are charged at a higher price to give the illusion of status. If a company is selling a product at 50 dollars and another company is selling the same product at 175 dollars, the customer will think that the better product is the one being sold at $175 because it costs more. Then they will buy the higher priced to receive higher quality.
Odd pricing makes everything look like a bargain, even though you are only saving a penny of a difference.
Even pricing is the idea that if a product is priced at an even amount, the costumer will look at it as a high quality product.
Skimming pricing is where at the introduction of a new high demand product, the prices are raised very high because the customers will pay any amount for the product. Then, after the high demand dies down, so do the prices until the company's next high demand product comes out. Example: IPhones.
Penetration pricing is when a company lowers the prices of a competitive product so that they will sell enormous amounts of their product in order to get into a competitive market.
Price Lining is when a retail store puts different prices on each item of the same category or product and prices them differently based on their quality and makes it easier for both the producer of the product(s) and the consumers.
Bundle pricing is where a company brings together the payment of two or more products or services together and sold for a lower price than they would be separately in order to bring more customers and boost business. Bundle pricing is also good for selling a high amount of products when a large amount of the product is being produced.
Loss Leader Pricing
Loss Leader Pricing is when a product is sold below the ideal price, sometimes with almost no direct profit, in order to gain sales for the overall business and company. This is done often in retail or grocery stores in order to pull customers away from the competition and to get more money off of the other products that the consumer buys.
Yield Management Pricing
Yield-Management Pricing is when a company or service looks at the supply and demand of their service and lowers the price so that their service will reach demand needs. Example: On Airlines, when a flight has a low number of passengers, they advertise these seats at a lower rate and look for ways to advertise them. This is the same way that websites like Hotwire find hotel rooms that are unused and sell/advertise them at a lower rate as to promote business for the website, the hotel and it's services.