Business Competition

Customers Pricing Strategies Non Pricing Strategies

Who are the customers?

Market segments:

•Age•Gender

•Income Group•Geographical area

•Interest groups•Behaviour (impulse shoppers)

Pricing Strategies

•Promotional Pricing: temporary price change i.e. 10% off

•Loss leaders: price is set lower than costs in the hope that customers also buy full price items i.e. supermarkets

•Penetration Pricing: low introductory price but price goes up one product is established i.e. interest magazines

•Skimming: high price to start, especially if there is little competition i.e. new technology

•Destroyer: low price to drive out the competition i.e. petrol

Non Pricing Strategies

•Opening hours•Product range

•Extra faculties, i.e. toilets, bag packing•Promotions I.e. BOGOF•Free gifts/competitions

•Reward schemes•Wrapping services

•Quality issues•Product availability