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difference between Penetration and Prestige pricing

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Describe the difference between Penetration and Prestige pricing. Give an example of each as well as the benefits and disadvantages of the two types of pricing.

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Demonstrate the difference between Penetration and Prestige pricing.

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In the penetration pricing strategy we set an entry price lower than the other competitors' in order to break down the brand loyalties. On the other hand in the prestige pricing, we keep our prices high in order to maintain an image of product quality and appeal to the customers who associate premium prices with high quality. So these pricing strategies are almost opposite.

The aim of the penetration pricing strategy is ...

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Umut Oltulu, MBA
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  • BSc, Dokuz Eylul University
  • MBA, Texas A&M University-Kingsville
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