Price adjustment Strategies

Companies apply a variety of price adjustment strategies to account for differences in consumer segments and situations.One is discount and allowance pricing,whereby the company establishes cash,quantity,funtional,or seasonal discounts,or various types of alllowances.A second strategy is segmented pricing,where the company sells a product at two or more prices to accommodate different customers,product forms, locations,or times. sometimes companies consider more than economics in their pricing decisions,using psychological pricing to better communicate a product's intended position. In promotional pricing a company temporarily offers discounts and sell their products below list price as a special event,sometimes even selling below cost as a loss leader.Another approach is geographical pricing,whereby the company decides how to price to distant customers,choosing from such alternatives as zone pricing,basing point pricing and freight-absorption pricing.Finally,International pricing means that the company adjusts its price to meet different conditions and expectations in different world markets.


Reference:
principles of Marketing