Skimming Price And Penetration Price Policy Which Of These Is Relevant In Pricing A New Product Under Different Competitive Conditions In The Market?


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I believe that it depends on the natural of the product and company. If it is a daily common household product, where by customers are price sensitive, penetration price policy would work better as the aim is to get more customers fast and through that , the overall profits will increase as the product goes through the effect of the experience curve.

However , if your product is high in cost and the company have established a set of image, In order to uphold the image and values people perceive , a skimming price policy should be adopted. It is also for prevention to future situation, you could lower your price should the response be bad.

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