Whizz Corp. wishes to introduce a new hybrid car into mature markets in developed countries with the goal of gaining mass-market share quickly. Which of the following pricing strategies would help the firm meet its goal?
A) market-skimming pricing
B) market-penetration pricing
C) market-segmentation pricing
D) cost-plus pricing
E) captive-product pricing

Question

Quizplus · Accepted Answer

Market-penetration pricing is a strategy in which a company sets a relatively low price for its product in order to quickly penetrate the market and gain market share. This strategy is ideal for a new product entering a highly competitive market, as it can quickly gain traction and establish brand recognition. In the case of Whizz Corp.'s new hybrid car, market-penetration pricing would allow the company to quickly establish a foothold in established markets by offering a lower price point compared to competitors. This would make the product more attractive to consumers and increase the likelihood of gaining mass-market share quickly.