Pricing Strategies

Decisions about pricing strategies should be set in conjunction with other marketing decisions about product design, packaging, branding, distribution, and promotion. All these marketing decisions are interrelated. The price you charge your customers will have a direct effect on the success of your business. There are several pricing objectives that product producers$$as well as retailers and wholesalers$$hope to achieve in pricing products for sale.

There are three major approaches to pricing strategy: cost$-$based pricing, target costing $($demand$-$based$),$ and competitive$-$based pricing. Other pricing strategies include price skimming, penetration pricing, everyday low pricing $($EDLP$),$ discounting $($high$-$low pricing$),$ bundling, and psychological pricing.

Match each scenario to the strategy it best illustrates.