BADM533
University of The Cumberlands
BADM533 - M51 Marketing Management
Recall the product life cycle from Chapter 8 and talk about the pricing methods
used at each stage of the life cycle.
Introduction stage - Depending on the type of goods, the price is usually either low or
high. For innovative products, the strategy is price penetration or price skimming. The price
is adjusted based on the answer. If demand is high and there is no competition, a high price is
set (Iacobucci, 2018).
Growth Stage - Price can be increased at this stage if the objective was price
penetration and sales have grown. As manufacturing has increased, the cost per unit of
creating items has decreased, allowing for cheaper prices (Iacobucci, 2018). Price can be
decreased if price skimming is employed. This, too, is dependent on the sales goals set by the
firm (Iacobucci, 2018). Companies will cut their prices if they can boost sales by doing so. If
a low-cost competitor enters the market, the price will be decreased. The business
must pursue a competitive pricing approach.
Maturity Stage - Sales are nearly stable at this stage, and competition is strong,
therefore businesses adopt a competitive pricing approach. Some businesses use a discount
price approach to get customers to buy their goods (Iacobucci, 2018).
Decline Stage - During this stage, product sales have decreased. Because sales have
decreased, the company has decided to cut the product's price. There are a variety of
techniques that may be used, such as discount pricing and bundling. Some businesses prefer
to do nothing with pricing because they aren't sure if sales are truly falling or if it's just a blip
on the radar (Iacobucci, 2018).
University of The Cumberlands
BADM533 - M51 Marketing Management
Recall the product life cycle from Chapter 8 and talk about the pricing methods
used at each stage of the life cycle.
Introduction stage - Depending on the type of goods, the price is usually either low or
high. For innovative products, the strategy is price penetration or price skimming. The price
is adjusted based on the answer. If demand is high and there is no competition, a high price is
set (Iacobucci, 2018).
Growth Stage - Price can be increased at this stage if the objective was price
penetration and sales have grown. As manufacturing has increased, the cost per unit of
creating items has decreased, allowing for cheaper prices (Iacobucci, 2018). Price can be
decreased if price skimming is employed. This, too, is dependent on the sales goals set by the
firm (Iacobucci, 2018). Companies will cut their prices if they can boost sales by doing so. If
a low-cost competitor enters the market, the price will be decreased. The business
must pursue a competitive pricing approach.
Maturity Stage - Sales are nearly stable at this stage, and competition is strong,
therefore businesses adopt a competitive pricing approach. Some businesses use a discount
price approach to get customers to buy their goods (Iacobucci, 2018).
Decline Stage - During this stage, product sales have decreased. Because sales have
decreased, the company has decided to cut the product's price. There are a variety of
techniques that may be used, such as discount pricing and bundling. Some businesses prefer
to do nothing with pricing because they aren't sure if sales are truly falling or if it's just a blip
on the radar (Iacobucci, 2018).
