What Is Penetration Pricing?

Penetration pricing is a marketing strategy that sets the price of a product at a lower level when it enters the market early to attract as many consumers as possible. The price is related to the product cycle. It enters the market at a lower product price, with the purpose of accelerating market growth in the short term, sacrificing high gross profit in order to obtain higher sales and market share, thereby generating significant cost economic benefits, enabling costs and prices to be Keep decreasing. Penetration price does not mean absolute cheap, but relatively low relative to value

Penetration pricing

Right!

Penetration pricing is a marketing strategy that sets the price of a product at a lower level when it enters the market early to attract as many consumers as possible. High and low prices

1. New products can quickly occupy the market, and use mass sales to reduce costs and obtain a long-term stable market position;

2. The small profit prevents competitors from entering, which can enhance the market competitiveness of enterprises.

3. Low price strategy to promote consumer demand.

1. Low profit.

2. Reduce the image of high-quality products.

1. The market is price sensitive. Demand is extremely price sensitive, and low prices can stimulate rapid market growth.

2. Production and operating expenses decrease with increasing experience.

3. Low prices will not cause actual or potential excessive competition.