Premium pricing is a technique used to maintain reputation, brand value, status, and quality. This strategy makes prices higher, resulting in lower sales. For instance, automobile-like Audemars Piguet or Bentley. Penetration pricing entails reducing prices lower than the competition in the market to get the consumers’ attention utilizing (Monger, 2012). For instance, they provide an advert that indicates low prices of a new product in the supermarket at some supermarket.
Also, Economic pricing entails selling items at a lower price to sell more products. Example of a company that uses this strategy is Walmart and Costco (Monger, 2012). Psychological pricing is a business strategy of pricing that sets a price lower than the whole number. For instance, a product is priced at $2.99, but the consumer conveys it like 2 dollars and not 3 dollars. Promotional pricing is a technique that involved reducing prices temporarily to attract more consumers (Monger, 2012). Examples include businesses making seasonal sales, flash sales, loyalty programs, and buy one get one free offer.
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The decision about purchasing a product that is high in price, assuming that the quality of a product is the same, is determined by several factors. Loyalty to a particular company is a factor. This entails purchasing products from the company for a long time hence established trust with the company no matter the price. Customer services also influence one to prefer purchasing products from a certain company even if the price is high (Monger, 2012). Convenience is also a factor as one would prefer buying from a store closer to where they live, not considering the price.
Certain products can be purchased regardless of the influence of the above factors. Personal factors such as occupation, age, economic, social status, and gender influences collectively or individual buying decisions. Also, the need for a certain product would not consider the product's price while making a purchase decision.
Reference
Monger, B. (2012). Managing your Marketing Better in Many Ways. Pricing Strategies and Policies . https://smartamarketing.wordpress.com/2012/pricing-strategies-and-policies/
