Practicing Success
Practicing Success
CUET Preparation Today
| Xeta Ltd. has developed a unique television set that has the features of a computer and can be controlled from outside the home using a mobile phone. A lot of investment went into the research and development of this unique television. The company decided to fix the price of the television in such a way that fewer sales can help reach break-even and could recover the cost of investment and research easily. The price has been fixed keeping in mind the early adopters who have relatively price conscious. Identify the pricing method used by Xeta Ltd. |
Variable Pricing Penetration Pricing Skimming Pricing Cost plus Pricing |
| Skimming Pricing |
| In most skimming, goods are sold at higher prices so that fewer sales are needed to break even. Selling a product at a high price, sacrificing high sales to gain a high profit is therefore "skimming" the market. Skimming is usually employed to reimburse the cost of investment of the original research into the product commonly used in electronic markets when a new range, such as smart phones, are firstly dispatched into the market at a high price. This strategy is often used to target "early adopters" of a product or service. |
