selling price based on competitors

[suchona.kani.z]

skimming price cost-based pricing strategies; pricing strategy based on value.
Skimming price
When researching product pricing methods and pricing strategies, you have probably heard of market skimming and skimming pricing. But what does market skimming mean?

Market skimming is one of the most widely used pricing strategies. According to this pricing strategy, the company applies a particularly high price to the launch of a new product, to maximize profits and singapore email list target the so-called “early adopters”. After an initial period in which the price is high, it is gradually reduced to target different types of customers using techniques such as market segmentation .

Advantages of the skimming pricing strategy
The advantage of this strategy is mainly in maximizing initial profits, in fact it allows the company to obtain consistent profits in the initial phase that can be very useful when launching a brand or a product. To then lower prices and include other customer segments. In addition, an image of a high quality product is provided.

Disadvantages of skimming pricing strategy
The other side of the coin is that paying a very high price for a product that turns out to be poor is counterproductive and could ruin the image of the brand. So make sure you have a very high quality product if you want to adopt this strategy and above all it is important not to overdo it. A very high price could have the opposite effect.

Finally, don’t forget about competition. A product with an unaffordable price has a lot of competition unless you are talking about a truly unique product.