Pricing — OpenTuition Forums

Aaisha11y ago

Hi Sir, Sir i know what is penetration and skimming approach, but i don't understand a question which is as follow: Compare and contrast penetration and skimming approaches? what is meant by compare and contrast, i read the answer several time but could't got the exact difference.

John MoffatTutor11y ago#1

'Compare and contrast' means that they want you to describe each of them and explain the difference. Penetration pricing is setting a low price in order to try and gain market share (with the intention of increasing the price later). Price skimming is starting with a high price with the intention of reducing it over time. I give 'real life' examples of both in the free lecture on pricing.

Aaisha11y ago#2

Thanks alot sir

John MoffatTutor11y ago#3

You are welcome :-)