The various pricing strategies which can be used when selling a product or service

It is a must for a firm or business selling their products or services to have their products or services rightly priced. The
pricing strategies are the most important factor which determines the success or failure of the product or services provided to a particular segment or section of customers or even the location. The pricing strategies of the company will help it in entering new markets, competing with other firms and gaining customers of a particular region or segment and so on. There are various pricing strategies which a company can choose and select and use it for a particular product or their overall products or services.



Absorption pricing is one such pricing strategy which can be used when pricing a product or service. It is named so as it enables all types of cost to recover. It is cost-plus pricing strategy which includes the fixed and the variable costs of the product or service. Market-oriented pricing is a pricing strategy which can be used if there is a lot of competition in the market. This type of pricing is done in order to compete in the market with other competitors. It is based on market research. The company will set the price of the products or services offered by it after analysing the price of the
products and services of its competitors in the online advertising target market. Then calculating its profit margin or the profit it wants to achieve, it will set its product or services price accordingly. Pricing strategies are varied and many and can be chosen according to one’s customers and target market.

Odd pricing is another strategy which is very popular these days as most companies are using this strategy for pricing their products or services in the market. You must have come across products which are priced at $9 or $299 instead of $10 or $300. The last digit of the price will be an odd number which will give the impression to customers as being less and thus leaving no scope for bargain. Customers will believe that it is less in price and therefore do not bargain, considering it reasonable. This type of pricing takes advantage of human psychology where individuals accept a high

price sensing it to be at a low price. A similar strategy is the psychological pricing strategy where exploitation of human
psychology acts as the base strategy.

Premium pricing is another pricing strategy which takes advantage of human psychology. It is believed that if a product is costly or expensive, it will be good or of high quality. Companies take advantage of such beliefs and price their products at a very high price or make it look expensive. They target a certain section of society and make their product look exclusive and premium as we know many people like to buy expensive items or desire it more than any other item priced lower than that. These affiliate marketing pricing strategies are a few of the many pricing strategy which are popularly used by
companies.