Post on 23-Dec-2015
KEY TERMSUNIT 5
(PRICING)
Marketing
BETWEEN THE MINIMUM A COMPANY CAN CHARGE TO
COVER COSTS AND THE MAXIMUM CUSTOMER IS
WILLING TO PAY.
Price Range
#2
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SALES AND ADMINISTRATIVE COSTS OF
DOING BUSINESS.
Operating Expenses
#3
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AN AMOUNT THAT HAS TO BE PAID OR GIVEN UP IN
ORDER TO GET SOMETHING.
Cost
#4
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COMBINED COSTS OF RAW MATERIALS, MACHINERY, AND
LABOR WHEN MAKING A PRODUCT.
Production Costs
#5
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OPERATING EXPENSES + PRODUCTION COSTS +
MARKUP AMOUNT.
Selling Price
#6
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AN AMOUNT OR % ADDED TO TOTAL PRODUCTION COSTS
FOR DESIRED PROFIT.
Markup
#7
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THE DIFFERENCE BETWEEN THE SELLING PRICE AND
ALL COSTS AND OPERATING EXPENSES ASSOCIATED
WITH THE PRODUCT SOLD.
Net Profit
#8
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THE QUANTITY OF A PRODUCT THAT MUST BE
SOLD AT A SPECIFIC PRICE FOR TOTAL REVENUE TO FINALLY MATCH TOTAL
COSTS.
Breakeven Point
#9
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A REDUCTION FROM THE ORIGINAL SELLING PRICE.
Markdown
#10
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PRODUCT PRICING STRATEGY OF TAKING PRODUCTION COSTS
AND ADDING A REQUIRED AMOUNT OR % FOR PROFIT.
Cost-Plus
#11
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PRODUCT SELLING AT OR BELOW COST TO MOTIVATE CUSTOMERS TO COME TO
STORE (LEGAL).
Loss Leader
#12
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STRATEGY OF AGGRESSIVELY PRICING
LOW WITH THE PURPOSE OF DRIVING OUT COMPETITION
(ILLEGAL).
Predatory
#13
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POSITIONING A PRODUCT WITH A HIGH PRICE,
COMPARED TO OTHERS, FOR A QUICKER “ROI”.
Skimming
#14
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A MEASURE OF PROFITABILITY (%)
INDICATING WHETHER OR NOT A COMPANY IS USING
ITS RESOURCES EFFICIENTLY.
Return on Investment (ROI)
#15
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SETTING AN ARTIFICIALLY LOW PRICE TO GAIN
MARKET SHARE AND THEN CREEP IT BACK TO NORMAL.
Penetration
#16
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PRICING SET HIGH FOR UNIQUE PRODUCTS WITH
PERCEIVED VALUE; LUXURY ITEMS.
Prestige (Premium)
#17
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TO COMBINE MORE THAN 1 PRODUCT IN THE SAME
PACKAGE TO ADD VALUE OR MOVE SLOWER SELLERS.
Bundle
#18
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REDUCTION IN THE REGULAR SELLING PRICE OF A PRODUCT FOR A SPECIFIC REASON (SEASONAL SALE).
Discount
#19
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COMPLIMENTARY REDUCTION IN PRICE GIVEN TO THOSE WHO ARE IN THE
TRADE (SAME TYPE OF BUSINESS).
Trade Discount
#20
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AN AMOUNT OF MONEY GIVEN BACK TO CONSUMER FOR THE PERFORMANCE OF
AN ACTION (REBATE OR TRADE-IN).
Allowance
#21
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The End
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