Product-line pricing
Product-line pricing sets related prices across a range of products or service tiers, considering differences in customer value, features, costs and interaction between offerings. The objective concerns the line’s performance, not simply identical mark-ups on every item. Evaluate substitution and cannibalisation as well as incremental demand. Clearly stated differences can help segmentation, but complexity and misleading tiers may damage trust or support costs.
Worked example
A business offers basic, standard and premium services with different response times and features, evaluating how customers move between the tiers.
Common mistake
A premium price must be assessed against perceived value and customer choice, not assumed justified solely by extra cost.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | PM | Direct | September 2026–June 2027 |