Model bakers have developed a snack cake that it wants to compete with Hostess Twinkies and has set their introductory price 10 cents below the price of a Twinkie.This
Is an example of which of the following?
A)Penetrating pricing
B)Skimming pricing
C)Life-cycle pricing
D)Competitive cycle pricing

Question

Quizplus · Accepted Answer

Penetrating pricing is a strategy where a company sets a lower price than their competitors to capture market share quickly. In this scenario, the model bakers are setting a price below that of Hostess Twinkies to compete with them, indicating a penetrating pricing strategy.

Model Bakers Have Developed a Snack Cake That It Wants