pricing tactics lower the price of a product below cost
loss leader
title: Pricing strategies text: cost-based method for setting the prices of goods and services. Under this approach, the direct material cost, direct labor cost, and overhead costs for a product are added up and added to a markup percentage (to create a profit margin) in order to derive the price of the product. In this type of pricing, the seller tends to fix a price whose last digits are just below a round number (also called just-below pricing). This is done so as to give the buyers/consumers no gap for bargaining as the prices seem to be less and yet in an actual sense title: Pricing text: is an approach that can be considered at the time of market entry. In this approach, the price of a product is initially set low in an effort to penetrate the market quickly. Low prices and low margins also act as a deterrent, preventing potential rivals from entering the market since they would have to undercut the low margins to gain a foothold. Prestige pricing is also known as "premium pricing" and occasionally "luxury pricing" or "high price maintenance" refers to the deliberate pursuit of a high price posture to create an image of quality. Price signalling is where the title: High–low pricing text: High–low pricing High–low pricing (or hi–low pricing) is a type of pricing strategy adopted by companies, usually small and medium-sized retail firms, where a firm initially charges a high price for a product and later, when it has become less desirable, sells it at a discount or through clearance sales. Prospective customers may be unaware of a product's typical market price, or have a strong belief that "discount" is synonymous with "low price", or have strong loyalty to the product, brand or retailer. There are many big firms using this type of pricing strategy (including, in North America, Reebok, Nike, title: Pricing strategies text: other pricing tactics such as economy or penetration. This method can have some setbacks as it could leave the product at a high price against the competition. Method of pricing where the seller offers at least three products, and where two of them have a similar or equal price. The two products with the similar prices should be the most expensive ones, and one of the two should be less attractive than the other. This strategy will make people compare the options with similar prices, and as a result sales of the more attractive high-priced item will increase. A form title: Premium pricing text: Premium pricing Premium pricing (also called image pricing or prestige pricing) is the practice of keeping the price of a product or service artificially high in order to encourage favorable perceptions among buyers, based solely on the price. Premium refers to a segment of a company's brands, products, or services that carry tangible or imaginary surplus value in the upper mid- to high price range. The practice is intended to exploit the tendency for buyers to assume that expensive items enjoy an exceptional reputation or represent exceptional quality and distinction. A premium pricing strategy involves setting the price of a