HL Pricing Strategies

Cost Plus Pricing

Adding a fixed profit margin to production cost.

Penetration Pricing

a strategy where a firm sets a low initial price to quickly gain market share.

Loss Leader

A product sold at a loss to attract customers and boost sales of other items.

Predatory Pricing

Setting extremely low prices to drive competitors out of the market, then raising prices later.

Dynamic Pricing

Adjusting prices frequently based on demand, competition, or market conditions in real time. E.g. Airlines, hotels, ride apps

Competitive Pricing

Setting prices based on what competitors are charging for similar products or services.

Contribution Pricing

Setting price based on variable costs plus a contribution toward fixed costs and profit.

Price Elasticity of Demand (PED)

Measures how much the quantity demanded changes in response to a price change.

Premium Pricing

Setting a high price to create a perception of superior quality or exclusivity.