Marketing 301 (Exam 3)
Study online at https://quizlet.com/_26xrld
1. Demand-Orient- - Skimming Pricing
ed Pricing - Penetration Pricing
Approaches - Prestige Pricing
- Price Lining
2. Skimming Pric- Used when introducing a new or innovative product, and involves setting the
ing highest initial price that customers really desiring the product are willing to pay
3. Penetration Pric- Involves setting a low initial price on a new product to appeal immediately to the
ing mass market
4. Odd-Even Pricing Involves setting prices a few dollars or cents under an even number
(ie. GIllette Fusion for $11.99)
5. Target Pricing (1) Estimating the price that ultimate consumers would be willing to pay for a
product
(2) Working backward through markups taken by retailers and wholesalers to
determine what price to charge wholesalers
(3) Deliberately adjusting the composition and features of the product to achieve
the target price to consumers
6. Bundle Pricing Involves the marketing of two or more products in a single package price
7. Yield Manage- Involves the charging of different prices to maximize revenue for a set amount of
ment Pricing capacity at any given time
(ie. airlines)
8. Cost-Oriented - Standard Markup Pricing
Pricing - Cost-Plus Pricing
Approaches - Experience Curve Pricing
9. Standard Markup Involves adding a fixed percentage to the cost of all items in a specific product
Pricing class
, Marketing 301 (Exam 3)
Study online at https://quizlet.com/_26xrld
10. Cost-Plus Pricing Involves summing the total unit cost of providing a product or service and adding
a specific amount to the cost to arrive at a price
11. Experience Curve A method of pricing based on the learning effect, which holds that the unit
Pricing cost of many products and services declines by 10% to 30% each time a firm's
experience at producing and selling them doubles, resulting in possible rapid
price reductions
(ie. Japanese and Korean electronics)
12. Margin Refers to the difference between the selling price and the "cost" of a product or
service
13. Three Types of - Gross Margin
Margins - Trade Margin
- Profit Margin
14. Gross Margin or Total Sales Revenue - Total Cost of Goods Sold
Gross Profit OR
Unit Selling Price - Unit Cost of Goods Sold
15. Trade Margin Unit Sales Price - Unit Cost At Each Level Of A Marketing Channel
(Manufacturer >> Wholesaler >> Retailer)
16. Profit-Oriented - Target Profit Pricing
Pricing - Target Return-on-Sales Pricing
Approaches - Target Return-on-Investment Pricing
17. Target Profit Pric- Involves setting an annual target of a specific dollar volume of profit
ing
18. Target Involves setting a price to achieve a profit that is a specified percentage of the
Return-on-Sales sales volume
Pricing
, Marketing 301 (Exam 3)
Study online at https://quizlet.com/_26xrld
19. Competition-Ori- - Customary Pricing
ented Pricing - Above-Market, At-Market, or Below-Market Pricing
Approaches - Loss-Leader Pricing
20. Customary Pric- Involves pricing setting a price that is dictated by tradition, a standardized channel
ing of distribution, or other competitve factors
21. Above-Market, Involves setting a market price for a product or product class based on a subjective
At-Market, or feel for the competitors' price or market price as the benchmark
Below-Market (ie. Nordstrom, JC Penny, private label brands)
Pricing
22. Loss-Leader Pric- Involves deliberately selling a product below its customary price, not to increase
ing sales, but to attract customers' attention in hopes that they will buy other products
as well
23. Special Adjust- - Discounts
ments to List or - Allowances
Quoted Price - Geographical
24. Special Adjust- Discounts given to buyer as reward for some activity that benefits the seller
ments to List or
Quoted Price -
Discounts
25. Types of Dis- - Quantity Discounts
counts - Seasonal Discounts
26. Special Adjust- Promotional Allowances (ie. Everyday Low Pricing/EDLP)
ments to List or
Quoted Price - Al-
lowances
27. Practice of replacing promotional allowances with lower manufacturer list prices
Study online at https://quizlet.com/_26xrld
1. Demand-Orient- - Skimming Pricing
ed Pricing - Penetration Pricing
Approaches - Prestige Pricing
- Price Lining
2. Skimming Pric- Used when introducing a new or innovative product, and involves setting the
ing highest initial price that customers really desiring the product are willing to pay
3. Penetration Pric- Involves setting a low initial price on a new product to appeal immediately to the
ing mass market
4. Odd-Even Pricing Involves setting prices a few dollars or cents under an even number
(ie. GIllette Fusion for $11.99)
5. Target Pricing (1) Estimating the price that ultimate consumers would be willing to pay for a
product
(2) Working backward through markups taken by retailers and wholesalers to
determine what price to charge wholesalers
(3) Deliberately adjusting the composition and features of the product to achieve
the target price to consumers
6. Bundle Pricing Involves the marketing of two or more products in a single package price
7. Yield Manage- Involves the charging of different prices to maximize revenue for a set amount of
ment Pricing capacity at any given time
(ie. airlines)
8. Cost-Oriented - Standard Markup Pricing
Pricing - Cost-Plus Pricing
Approaches - Experience Curve Pricing
9. Standard Markup Involves adding a fixed percentage to the cost of all items in a specific product
Pricing class
, Marketing 301 (Exam 3)
Study online at https://quizlet.com/_26xrld
10. Cost-Plus Pricing Involves summing the total unit cost of providing a product or service and adding
a specific amount to the cost to arrive at a price
11. Experience Curve A method of pricing based on the learning effect, which holds that the unit
Pricing cost of many products and services declines by 10% to 30% each time a firm's
experience at producing and selling them doubles, resulting in possible rapid
price reductions
(ie. Japanese and Korean electronics)
12. Margin Refers to the difference between the selling price and the "cost" of a product or
service
13. Three Types of - Gross Margin
Margins - Trade Margin
- Profit Margin
14. Gross Margin or Total Sales Revenue - Total Cost of Goods Sold
Gross Profit OR
Unit Selling Price - Unit Cost of Goods Sold
15. Trade Margin Unit Sales Price - Unit Cost At Each Level Of A Marketing Channel
(Manufacturer >> Wholesaler >> Retailer)
16. Profit-Oriented - Target Profit Pricing
Pricing - Target Return-on-Sales Pricing
Approaches - Target Return-on-Investment Pricing
17. Target Profit Pric- Involves setting an annual target of a specific dollar volume of profit
ing
18. Target Involves setting a price to achieve a profit that is a specified percentage of the
Return-on-Sales sales volume
Pricing
, Marketing 301 (Exam 3)
Study online at https://quizlet.com/_26xrld
19. Competition-Ori- - Customary Pricing
ented Pricing - Above-Market, At-Market, or Below-Market Pricing
Approaches - Loss-Leader Pricing
20. Customary Pric- Involves pricing setting a price that is dictated by tradition, a standardized channel
ing of distribution, or other competitve factors
21. Above-Market, Involves setting a market price for a product or product class based on a subjective
At-Market, or feel for the competitors' price or market price as the benchmark
Below-Market (ie. Nordstrom, JC Penny, private label brands)
Pricing
22. Loss-Leader Pric- Involves deliberately selling a product below its customary price, not to increase
ing sales, but to attract customers' attention in hopes that they will buy other products
as well
23. Special Adjust- - Discounts
ments to List or - Allowances
Quoted Price - Geographical
24. Special Adjust- Discounts given to buyer as reward for some activity that benefits the seller
ments to List or
Quoted Price -
Discounts
25. Types of Dis- - Quantity Discounts
counts - Seasonal Discounts
26. Special Adjust- Promotional Allowances (ie. Everyday Low Pricing/EDLP)
ments to List or
Quoted Price - Al-
lowances
27. Practice of replacing promotional allowances with lower manufacturer list prices
