One reason marketers of new,innovative products often start out with a price skimming strategy rather than a market penetration strategy is that
A) few consumers understand a penetration strategy.
B) a price skimming strategy lowers the value for consumers.
C) a price skimming strategy targets all product adopters equally.
D) it is easier to lower prices than to raise them.
E) price skimming is legal while price penetration is not.

Question

Quizplus · Accepted Answer

Starting out with a price skimming strategy allows marketers to set higher prices initially and target early adopters who are willing to pay a premium for the product. If demand starts to slow down or the competition enters the market, the marketer can then lower prices to attract more price-sensitive consumers. It is easier to lower prices because consumers are often resistant to paying more for a product they have already purchased at a lower price.

One Reason Marketers of New,innovative Products Often Start Out with a Price