Competition-based pricing

Setting the price based upon prices of the similar competitor products.

Competitive pricing is based on three types of competitive product:

• Products have lasting distinctiveness from competitor's product. Here we can assume
• The product has low price elasticity.
• The product has low cross elasticity.
• The demand of the product will rise.
• Products have perishable distinctiveness from competitor's product, assuming the product features are medium distinctiveness.
• Products have little distinctiveness from competitor's product. assuming that:
• The product has high price elasticity.
• The product has some cross elasticity.
• No expectation that demand of the product will rise. Ref: http://en.wikipedia.org/wiki/Pricing_strategies