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| Term | Definition |
|---|---|
| Price | The formal ratio that indicates the quantities of money goods or services needed to acquire a given quantity of goods or services. |
| Market Position | the customer's perceptions of the place a product or brand occupies in a market segment |
| Market Share | the percentage of a market (defined in terms of either units or revenue) accounted for by a specific entity. |
| Cost | The money expended to produce and market a product or service. Markup - The difference between merchandise cost and the retail price. |
| Margin | - The difference between the selling price and total unit costs for an item. Markdown -The amount of a reduction from the selling price. |
| Break-Even Point | - The sales volume at which total revenues are equal to total costs. |
| Elasticity | - The degree that an economic variable changes in response to a change in another economic variable. |
| Price Competition | - The rivalry among firms seeking to attract customers on the basis of price, rather than by the use of other marketing factors. |
| Nonprice Competition | rivalry based on quality of service, distribution, and promotion that highlights the benefits and features of their products. |
| Price Fixing | - The practice of two or more sellers agreeing on the price to charge for similar products or services. |
| Price Discrimination | The practice of charging different buyers different prices for the same quantity and quality of products or services |
| Market share | is the percentage of a market (defined in terms of either units or revenue) accounted for by a specific entity. |
| Return on Investment (ROI) | is one way of considering profits in relation to capital invested. |
| Cost-Based Pricing | A pricing method in which a fixed sum or a percentage of the total cost is added to the cost of the product to arrive at its selling price |
| Demand-Based Pricing | - A method of pricing in which the seller attempts to set price at the level that the intended buyers are willing to pay. It is also called value in-use pricing or value-oriented pro Flexible |
| Price Policy | A practice of selling at different prices to different customers. This practice could be suspect under the Robinson-Patman Act. |
| One-Price Policy | A policy that, at a given time, all customers pay the same price for any given item of merchandise |
| Psychological Pricing | A method of setting prices intended to have special appeal to consumers |
| Prestige Pricing | higher than average prices to suggest status and high quality to the customer |
| Odd/Even Pricing | A form of psychological pricing that suggests buyers are more sensitive to certain ending digits. Odd price refers to a price ending in an odd number |
| Price Lining | A limited number of predetermined price points at which merchandise will be offered for sale-e.g., $7.95, $10.95, $14.95. |
| Promotional Pricing | when prices are reduced for a short period of time during a sales promotion. |
| Cash Discounts | A premium for advance payment at a rate that is usually higher than the prevailing rate of interest. It also is a reduction in price allowed the buyer for prompt payment |
| Quantity Discounts | A reduction in price for volume purchases |
| Trade Discounts | The discount allowed to a class of customers (manufacturers, wholesalers, retailers) on a list price before consideration of credit terms. |
| Promotional Discounts | - An allowance given by vendors to retailers to compensate the latter for money spent in advertising a particular item in local media, or for preferred window and interior display space used for the vendor's product. |
| Seasonal Discounts | A special discount to all retailers who place orders for seasonal merchandise well in advance of the normal buying period. |
| Skimming Pricing | A method of pricing that attempts to first reach those willing to buy at a high price before marketing to more price-sensitive customers. |
| Penetration Pricing | A pricing policy that sets a low initial price in an attempt to increase market share rapidly. This policy is effective if demand is perceived to be fairly elastic |
Created by:
Tshipman4419