Distinguish between market-skimming pricing and market-penetration pricing
What will be an ideal response?
Many companies that invent new products set high initial prices to skim revenues layer by layer from the market. This is known as market-skimming pricing. For this strategy to work, the product's quality and image must support its higher price, and enough buyers must want the product at that price. The costs of producing a smaller volume cannot be so high that they cancel the advantage of charging more. Competitors should not be able to enter the market easily and undercut the high price. Market-penetration pricing is used to penetrate the market quickly to attract a large number of buyers in a short period and win a large market share by setting a low initial price. For this strategy to work, the market must be highly price sensitive so that a low price produces more market growth. Production and distribution costs must fall as sales volume increases. Also, the low price must help keep out competition and be maintained over time.
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A negative comparison ad that causes people to dislike the sponsor brand may be due to:
A) the preemptive claim of superiority B) a generic demonstration of product quality C) spontaneous trait transference D) internal cognitive consistency
Which barrier to collaboration occurs when people are unwilling to share?
A. The hoarding barrier B. The search barrier C. The transfer barrier D. The not-invented-here barrier
The balance sheet portrays the effects of a firm's investing and financing decisions
Indicate whether the statement is true or false
Pitching to bloggers
A) is a simple and straightforward process. B) is no different than pitching to traditional media outlets. C) can be a little different than pitching to traditional media outlets. D) requires no prior audience research. E) is never worth the time and effort of MPR professionals.