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Marketing 450 - Paul
Pricing
30
Marketing
Undergraduate 3
03/14/2010

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Term
Overall sacrifice a consumer is willing to make - money, time energy - to acquire a specific product or service
Definition
Price
Term
Company objective implemented by focusing on target profit pricing, maximizing profit or target return pricing
Definition
Profit orientation
Term
an economically based pricing strategy that attempts to identify the price at which a product or service profits are maximized

a. maximizing profits
b. targeting return pricing
c. premium pricing
d. competitor orientation
e. Sales Orientation
Definition
Maximizing profits
Term
Strategy implemented by firms interested in the rate of profits relative investments; designed to produce specific return on investment, usually expressed as percentage of sales

a. maximizing profits
b. targeting return pricing
c. premium pricing
d. competitor orientation
e. Sales Orientation
f. Competitive Parity
Definition
Target return pricing
Term
Company objective based on the belief that increasing sales help the firm more than increasing profits

a. maximizing profits
b. targeting return pricing
c. premium pricing
d. competitor orientation
e. Sales Orientation
f. Competitive Parity
Definition
Sales Orientation
Term
a company objective based on the premise that the firm should measure itself primarily against its competition

a. maximizing profits
b. targeting return pricing
c. premium pricing
d. competitor orientation
e. Sales Orientation
f. Competitive Parity
Definition
Competitor Orientation
Term
strategy of setting prices similar to those of major competitors.

a. maximizing profits
b. targeting return pricing
c. premium pricing
d. competitor orientation
e. Sales Orientation
f. Competitive Parity
Definition
Competitive Parity
Term
Competitor based pricing method; firm deliberate prices products above competitors to capture consumers who always shop for the best or for whom price does not matter

a. premium pricing
b. status quo pricing
c. customer oriented pricing
d. Price Skimming
e. Market Penetration Pricing Strategy
Definition
Premium Pricing
Term
competitor oriented strategy; firms changes prices only to meet those of competition

a. premium pricing
b. status quo pricing
c. customer oriented pricing
d. Price Skimming
e. Market Penetration Pricing Strategy
Definition
Status Quo Pricing
Term
Orientation That explicitly invokes the concept of customer value and sets prices to match consumer expectations
a. premium pricing
b. status quo pricing
c. customer oriented pricing
d. Price Skimming
e. Market Penetration Pricing Strategy
Definition
Consumer Oriented pricing
Term
strategy of selling innovation at a high price that innovators and early adapters will pay to obtain it, then lowering the price to capture the next more price sensitive segment

a. premium pricing
b. status quo pricing
c. customer oriented pricing
d. Price Skimming
e. Market Penetration Pricing Strategy
Definition
Price Skimming
Term
Pricing strategy that sets low initial price of new product or service to build sales, market share and profits quickly

a. premium pricing
b. status quo pricing
c. customer oriented pricing
d. Price Skimming
e. Market Penetration Pricing Strategy
Definition
Market Penetration Pricing Strategy
Term
how many units of a product or service consumers demand during a specific period at different prices
Definition
Demand Curve
Term
Measures how changes in price affect quantity of prduct demanded;specifically ratio of the percentage change in quantity demanded to the percentage change in price
Definition
Price elasticity of demand
Term
market for a product or service that is price sensitive; relatively small changes in price generate large changes in quantity demanded
Definition
Elastic
Term
Market for a product or service that is price insensitive; relatively small changes in price do not generate large changes int he quantity demanded
Definition
Inelastic
Term
change in quantity of a product demanded by consumeres due to a change in their income
Definition
Income affect
Term
Consumers ability to substitute other products for the focal brand and increase price elasticity of demand for the focal brand
Definition
Substitution Effect
Term
Higher price to which consumers can compare the selling price to evaluate a purchase

a. Reference Price
b. External reference price
c. internal reference price
d. everyday low pricing
e. high/low pricing
f. cost based pricing
Definition
External Reference Price
Term
Price info saved in the consumers memory, used to assess a current price offering

a. Reference Price
b. External reference price
c. internal reference price
d. everyday low pricing
e. high/low pricing
f. cost based pricing
Definition
Internal reference price
Term
strategy to emphasize the continuity of retail prices somewhere between the regular, non sale price and deep discount sale prices

a. Reference Price
b. External reference price
c. internal reference price
d. everyday low pricing
e. high/low pricing
f. cost based pricing
Definition
Everyday low pricing
Term
price against which buyers compare actual selling price of a product; facilitates evaluation process

a. Reference Price
b. External reference price
c. internal reference price
d. everyday low pricing
e. high/low pricing
f. cost based pricing
g. Leader pricing
h. loss leader pricing
i. predatory pricing
Definition
Reference Pricing
Term
strategy to promote sales by temporarily reducing prices to encourage purchase

a. Reference Price
b. External reference price
c. internal reference price
d. everyday low pricing
e. high/low pricing
f. cost based pricing
g. Leader pricing
h. loss leader pricing
i. predatory pricing
Definition
High/low pricing
Term
pricing strategy that involves determining the costs of producing a product and adding a fixed amount to arrive at the selling price

a. Reference Price
b. External reference price
c. internal reference price
d. everyday low pricing
e. high/low pricing
f. cost based pricing
g. Leader pricing
h. loss leader pricing
i. predatory pricing
Definition
Cost-based pricing
Term
consumer pricing tactic to build store traffic by aggressively pricing and advertising regularly purchased items at or just above the stores cost

a. Reference Price
b. External reference price
c. internal reference price
d. everyday low pricing
e. high/low pricing
f. cost based pricing
g. Leader pricing
h. loss leader pricing
i. predatory pricing
Definition
Leader Pricing
Term
extend leader pricing by lowering the price the stores cost

a. Reference Price
b. External reference price
c. internal reference price
d. everyday low pricing
e. high/low pricing
f. cost based pricing
g. Leader pricing
h. loss leader pricing
i. predatory pricing
Definition
loss leader pricing
Term
practice of setting very low prices with the intent to drive competitors out of business
Definition
Predatory Pricing
Term
When a few firms dominate a market

a. oligopolistic competition
b. Monopolistic Competition
c. Pure competition
Definition
few firms dominating market
Term
many firms sell closely related but not homogeneous products; products may be viewed as but are not perfect substitutes

a. oligopolistic competition
b. Monopolistic Competition
c. Pure competition
Definition
Monopolistic Competition
Term
when different companies sell commodity products that consumer perceive as substitutable; price usually set according to laws of supply and demand

a. oligopolistic competition
b. Monopolistic Competition
c. Pure competition
Definition
Pure Competition
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