Retail Pricing Strategies and Market Power-myassignmenthelp.com

Question: Discuss about theRetail Pricing Strategies and Market Power. Answer: In price competition two almost similar products are offered at different prices and customers are price sensitive and they prefer cheaper products. If the product has substitutes and there are so many competitors then price competition is followed. In non-pricecompletion a firm distinguishes its product from others by adding additional features(Schlinder, 2011). This strategy is followed when market is not price sensitive and product is differentiated. Skimming is a pricing strategy in which high price is charged initially and after capturing the market price is reduced gradually. This type of strategy is followed in case of innovative products and when there are fewer competitors. Penetration is a pricing policy in which low price is charged initially in order to capture the market and to increase sales. Ordinary products for which many substitutes are availablepenetration policy are followed. Customers always want quality service at reasonable price and an additional surcharge is an additional fee they have to pay for the same product or services so response is negative. We plan our holiday during off season to Kerala where we get advantage of off season price discounting strategy in which low price is offered for the same package or services if taken in season. When the company launches latest technology product then price skimming policy should be adopted in order to build brand loyalty and to capture the cream of the market(Mills, 2002). Bibliography Mills, G. (2002). Retail Pricing Strategies and Market Power. London: Springer . Schlinder, R. (2011). Pricing Strategies: A Marketing Approach. New York: Springer Publications.