When a new product is introduced to a market and is priced high with the intention of eventually lowering the price as the market becomes more competitive, marketers are using a pricing strategy known as
A) value-adding prices.
B) premium pricing.
C) rapid recovery.
D) skimming.

Question

Quizplus · Accepted Answer

This pricing strategy is known as skimming. It involves setting a high price when a product is introduced to the market and then gradually lowering the price over time as competition increases and the novelty of the product decreases. This strategy is often used to recover the initial investment quickly and to take advantage of the product's novelty and lack of competition at the beginning.

When a New Product Is Introduced to a Market and Is