what is price skimming 
price skimming is a pricing strategy in which a company starts by charging the highest price that customers will pay over time the company lowers the price to reach different types of customers initially the high price targets early adopters willing to pay more for a new product as these early customers are satisfied and competitors enter the market the company reduces prices to attract more price sensitive consumers 1 price skimming originates from skimming layers like removing successive layers of cream from the top of milk unlike penetration pricing which starts with a low price to attract a large customer base quickly price skimming leverages initial high prices to maximize early profits before adjusting to more competitive levels 2investopedia sydney saporito