Virtual Electronics is considering a strategy to charge a very high introductory price for their automobile video theater. After identifying that their rival firms did not carry this new product, they chose this pricing strategy to achieve maximum profits. Virtual Electronics has chosen a ________ strategy.
A) high-low pricing
B) penetration
C) bundling
D) skimming

Question

Quizplus · Accepted Answer

Virtual Electronics has opted for skimming pricing strategy where they charge a high introductory price for their new product. This strategy is suitable for new and innovative products that have no close substitutes in the market. The aim is to attract the early adopters who are willing to pay a premium price for the product. This strategy helps the company to recoup its development and marketing costs quickly, generate high profits, and establish its brand image as a premium one.

Virtual Electronics Is Considering a Strategy to Charge a Very