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46 Cards in this Set
- Front
- Back
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price
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that which is given up in an exchange to acquire a good or service
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revenue
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the price charged to customers multiplied by the number or units sold
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profit
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revenue minus expenses
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return on investment
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net profit after taxes divided by total assets
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market share
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a company's product sales as a percentage of total sales for that industry
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status quo pricing
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a pricing objective that maintains existing prices or meets the competitions prices
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demand
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the quantity of a product that will be sold in the market at various prices for a specified period
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supply
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the quantity of a product that will be offered to the market by a supplier at various prices for a specified period
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elasticity of demand
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consumers responsiveness or sensitivity to changes in price
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elastic demand
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a situation in which consumer demand in sensitive to changes in price
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inelastic demand
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a situation in which an increase or a decrease in price will not significantly affects demand for the product
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yield management systems
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a technique for adjusting prices that uses complex mathematical software to profitably fill unused capacity by discounting early purchases, limiting early sales at these discounted prices, and over booking capacity
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variable cost
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a cost that varies with changes in the level of output
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fixed cost
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a cost that does not change as output is increased or decreased
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markup pricing
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the cost of buying the product from the producer plus amounts for profit and for expenses not otherwise accounted for
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break even analysis
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a method of determining what sales volume must be reached before total revenue equals total costs
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prestige pricing
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charging a high prices to help promote a high quality image
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price strategy
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a basic long term pricing framework which establishes the initial price for a product and the intended direction for price movements over the product life cycle
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price skimming
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a pricing policy whereby a firm charges a high introductory price often coupled with heavy promotion
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penetration pricing
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a pricing policy whereby a firm charges a relativley low prices for a product initially as a way to reach the mass market
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unfair trade practice acts
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laws that prohibit wholesalers and retailers from selling below cost
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price fixing
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an agreement between two or more firms on the price they will charge for a product
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base price
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the general price level at which the company expects to sell the good or service
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quantity discount
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a price reduction offered to buyers buying in multiple units or above a specified dollar amount
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cumulative quantity discount
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a deduction from list price that applies to a single order rather that to the total volume of orders placed during a certain period
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noncumulative quantity discount
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a deduction from list price that applies to a single order rather than to the total volume of orders placed during a certain period
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cash discount
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a price reduction offered to a consumer, an industrial user or a marketing intermediary in return for prompt payment of a bill
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functional discount
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a discount to wholesalers and retailers for performing channel functions
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seasonal discount
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a price reduction for buying merchandise out of season
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promotional allowance
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a payment to dealer for promoting the manufacturer's product
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rebate
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a cash refund given for the purchase of a product during a specific period
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value based pricing
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setting the price at a level that seems to the customer to be a good price compared to the prices of other options
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FOB origin pricing
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a price tactic that requires the buyer to absorb the freight costs from the shipping point "free on board"
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uniform delivered pricing
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a price tactic in which the seller pays the actual freight charges and bills every purchaser an identical, flat freight charge
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zone pricing
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a modification of uniform delivered pricing that divides the US into segments or zones and charges a flat freight rate to all customers in a given zone
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freight absorption pricing
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a price tactic in which the seller pays all or part of the actual freight charges and does not pass them on the buyer
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basing point pricing
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a price tactic that charges freight from a given point regardless of the city from which the goods are shipped
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single price tactic
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a price tactic that offers all goods and services at the same price
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flexible pricing
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a price tactic in which different customers pay different prices for essentially the same merchandise bought in equal quantities
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leader pricing
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a price tactic in which a product is sold near or even below cost in the hope that shoppers will buy others items once they are in the store
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bait pricing
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a price tactic that tries to get consumers into a store through false or misleading price advertising and then uses high pressure selling to persuade consumers to buy more expensive merchandise
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odd even pricing
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a price tactic that uses odd number prices to connote bargains and even numbered prices to imply quality
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price bundling
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marketing two or more products in a single package for a special price
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unbundling
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reducing the bundle of services that come with the basic product
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two part pricing
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a price tactic that charges two separate amounts to consume a single good or service
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consumer penalty
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an extra fee paid by the consumer for violating the terms of the purchasing agreement
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