Explain the different method of pricing used in international marketing.
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Answers ( 2 )
1) Price skimming:- Price skimming sees an enterprise charge a higher rate because it has a substantial competitive benefit. However, the benefit tends not to be sustainable and reasonable. The high cost tempts new competitors into the market, and the rate inevitably decreases due to increased supply.
2) Penetration Pricing :- The rate issued for goods and services is set artificially low in order to earn market share. After achieving, the price is increased. This strategy was first used by France Telecom and Sky TV. Enterprises need to grab the opportunity to hold on to customers, so they offered free telephones or satellite dishes at minimal rates. And eventually, people signed up for their services.
3)Economy Pricing:- Budget airlines are popular for keeping their overheads as low as possible and then providing the customer a comparative lower rate to fill an aircraft. The first few seats are sold at a very low rate almost an advertisement rate price and the middle majority are economy seats, with the highest rate being sold for the last few seats on a flight i.e. in the premium pricing strategy. During times of recession, economy pricing records more purchase.
1. Penetration Pricing :-
The rate issued for goods and services is set artificially low in order to earn market share. After achieving, the price is increased. This strategy was first used by France Telecom and Sky TV. Enterprises need to grab the opportunity to hold on to customers, so they offered free telephones or satellite dishes at minimal rates. And eventually, people signed up for their services.
2. Economy Pricing:-
Here, the rates of marketing and advertising a product are kept as low as possible. Supermarkets often have economy brands for soups, spaghetti, biscuits, etc.
Budget airlines are popular for keeping their overheads as low as possible and then providing the customer a comparative lower rate to fill an aircraft. The first few seats are sold at a very low rate almost an advertisement rate price and the middle majority are economy seats, with the highest rate being sold for the last few seats on a flight i.e. in the premium pricing strategy. During times of recession, economy pricing records more purchase.
3. Price skimming:-
Price skimming sees an enterprise charge a higher rate because it has a substantial competitive benefit. However, the benefit tends not to be sustainable and reasonable. The high cost tempts new competitors into the market, and the rate inevitably decreases due to increased supply.
Producers of smart phones used a skimming strategy. Once other producers penetrated into the market and the smart phones were manufactured at a lower unit price, other marketing approaches and pricing approaches were executed. New products were launched and the market for smart phones earned a reputation for innovation.