Penetration Pricing

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Penetration Pricing is the strategy of pricing a newly launched product or service at a low initial price to gain attention of shoppers. 

Penetration Pricing Explained

When we launch a new product we have two options, either to price the product at a very high price and gradually discount the product, this strategy is used to maximise profits. This is called Price Skimming. Another strategy is to launch a product at a low initial price to capture market share and then gradually increase prices, this is called the Penetration Pricing Strategy.

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