In response to Duracell's introduction of the Duracell Ultra battery, Energizer introduced an Advanced Formula battery. But unlike Duracell, Energizer priced its batteries at a low initial price to attract the mass market. In this case, Energizer used
A)penetration pricing.
B)prestige pricing.
C)skimming pricing.
D)price lining.
E)cost-plus fixed-fee pricing.

Question

Quizplus · Accepted Answer

Energizer used penetration pricing, which involves setting a low initial price for a new product in order to attract a large number of buyers and gain market share quickly. This strategy is often used when there is significant competition in the market, as it allows the company to differentiate its product and gain a foothold in the market. Energizer likely used this strategy to counter Duracell's introduction of the Duracell Ultra battery and gain market share.

In Response to Duracell's Introduction of the Duracell Ultra Battery