Marketing Price Strategies and Advanced Pricing Concepts

This set of vocabulary flashcards covers advanced marketing concepts including price segmentation, dynamic pricing strategies, auction types, negotiation methods, and legal/ethical issues in pricing.

Price Segmentation

The process of maximizing revenue by offering the right price to the right customer, also known as price differentiation.

Demographic Segmentation

A form of price segmentation that offers different pricing, such as student or senior discounts, based on customer demographics.

Time-based Segmentation

Adjusting prices based on when customers buy, such as offering early bird promos or cheaper pricing during off-peak hours.

Value-based Pricing Segmentation

A strategy where different prices are set based on the amount of value customers see in the product or service.

Volume-based Pricing

A pricing type applied based on the quantity of purchases made by the customer.

Geographic-based Pricing

A pricing strategy that sets prices based on geographical location or the purchasing power in a given location.

Dynamic Pricing

Adjusting prices in real-time based on current market conditions, customer demand, time of day, competition, or customer behavior.

Location-Based Pricing

A strategy within dynamic pricing that involves offering different prices based on a customer's geographical location.

Yield Management

A pricing strategy focused on maximizing profit by selling the right product to the right customer at the right time.

Overbooking

A technique under yield management that allows businesses to accept more reservations than their actual capacity.

Dutch Auction

An auction type that begins at a high price and lowers it until a bidder accepts the price.

Second-Price Sealed-Bid (Vickrey) Auction

An auction where the highest bidder wins the item but pays the amount of the second-highest bid.

First-Price Sealed-Bid Auction

An auction where buyers submit secret bids and the highest offer wins at their own bid price.

Principled Negotiation

A negotiation strategy characterized by mutual gain and a focus on interests.

Team Negotiation

A negotiation type that involves multiple people bargaining on each side.

Price Fixing

An illegal agreement among competitors to set a certain price for a product instead of competing.

Predatory Pricing

An issue where prices are set extremely low to eliminate competition and are then raised later.

Resale Price Maintenance (RPM)

A legal pricing issue where a manufacturer sets a minimum price that retailers must follow.

Price Discrimination

An issue occurring when two retailers are charged differently for the same quantity of products under similar terms.

Deceptive Pricing

A pricing issue involving practices such as offering large discounts while hiding extra fees.

Advanced Pricing

The use of data and market analysis to set a smart price based on customer value, market dynamics, and rival actions.