Program: BS Accounting and Finance

Subject: Marketing
Presented to: Mam Zara
Presented by: Firzok Ghauri,
Matee Ur Rehman
Roll No: LF-1092,
LF-1097
Date : December 23, 2020
PRICING STRATEGY
 Pricing strategy
 Pricing strategy refers to method companies use to price their
products or services.
 Almost all companies, large or small, base the price of their
products and services on production, labor and advertising
expenses and then add on a certain percentage so they can make
a profit
 MARKET PENETRATION
 Penetration pricing is a marketing strategy used by businesses to
attract customers to a new product or service by offering a lower
price during its initial offering.
 Market penetration pricing relies on the strategy of using
low prices initially to make a wide number of customers aware
of a new product.
 This is done to create market share or to increase it.
EXAMPLES
 ECONOMY PRICING

 Economy pricing is a method of pricing in which a low price is assigned to a

product with decreased production costs.
EXAMPLES:
 PRICING AT PREMIUM
 Premium pricing is a strategy that involves
tactically pricing your company's product higher than your
immediate competition.
 The purpose of pricing your product at a premium is to cultivate
a sense in the market of your product being just that bit higher in
quality than the rest.
EXAMPLES
 Price skimming
 A pricing approach in which the producer sets a high
introductory price to attract buyers with a strong desire for the
product and the resources to buy it, and then gradually reduces
the price to attract the next and subsequent layers of the market.
EXAMPLES:
 PSYCHOLOGICAL PRICING

 Psychological pricing is a pricing and marketing strategy based

on the theory that certain prices have a psychological impact.
 In this pricing method, retail prices are often expressed as just-
below numbers: numbers that are just a little less than a round
number, eg 199.00 or 4,499.
EXAMPLES:
 BUNDLE PRICING
 Price bundling is combining several products or services into a
single comprehensive package for an all-inclusive reduced price.
 Despite the fact that the items are sold for discounted prices, it
can increase profits because it promotes the purchase of more
than one item.
EXAMPLES:
 GEOGRAPHICAL PRICING

 The practice of adjusting an item's sale price based on the

location of the buyer.
 Sometimes the difference in the sale price is based on the cost to
ship the item to that location.
 But the difference may also be based on what amount the people
in that location are willing to pay.
EXAMPLE:
 PROMOTIONAL PRICING
 Promotional pricing is a sales strategy in which brands
temporarily reduce the price of a product or service to attract
prospects and customers.
 By lowering the price for a short time, a brand artificially
increases the value of a product or service by creating a sense of
scarcity.
EXAMPLES:
 VALUE PRICING

 Value pricing is customer-focused pricing, meaning companies

base their pricing on how much the customer believes a
product is worth.
EXAMPLE:
 CAPTIVE PRICING
 Captive products are strategically used to maximize revenue.
 Sellers generally follow a product-mix pricing strategy
when pricing captive products.
 Low price are offered for the core product, but high prices are
placed on captive products.
EXAMPLES:
 Conclusion
 Unlike the other ingredients of the marketing price is most
important factor which generates revenue, so arriving at the
correct price is vital to the success of the business. However,
there is no one magic pricing strategy that will guarantee
success, so a firm should be constantly researching the market to
identify a correct policy for its product or service Pricing also
tells a business that how much advertising or marketing of a
product gets because of the relationship to cost and consumer
happiness.