ch 8 mktg 3325

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Pricing Strategies
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Terms in this set (11)
Focus on the "cost" side of the business and not the demand side

Ignores the customer and what the competitors are charging

Have to remember that cost sometimes serves as an indicator of quality (i.e., low cost might signal low quality)

Should perform a break-even analysis to determine break-even point (i.e., total cost/total revenue equal)
Some costs to consider are fixed (i.e., rent, executive salaries) and variable costs (i.e., materials, labor)
Cons of Customer-Based PricingCalculations may ignore product costs It might forget about existing competitors It requires great selling techniques