A Penetration Strategy Tends to Be Effective in a Price-Sensitive

question 129

Multiple Choice

A penetration strategy tends to be effective in a price-sensitive market.Thus,one of the purposes of penetration pricing is to:

• A) recoup product development costs quickly
• B) discourage competitors from entering the market
• C) produce a large margin of profit per unit
• D) develop exclusive distribution
• E) attract the price-insensitive buyer who demands the latest in technology

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Definitions:

Kirkland

A brand name owned by Costco Wholesale Corporation that offers a wide range of products, including groceries and household goods.

Fighting Brands

These are lower-priced products launched by companies to compete with generic or store brands and to protect their premium brands' market share without lowering the price of their main products.

Brand Extensions

A marketing strategy where a company uses an existing brand name to launch a new or modified product in a different product category.

Defensive Moves

Strategies employed by companies to protect their market share, revenue, or profitability from competitors.