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