Penetration pricing attempts to hasten market development and offers the pioneer the opportunity to use the experience curve to gain market share with a low price and dominate the industry.

Question

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Penetration pricing is a marketing strategy in which a product is offered at a low price in order to gain market share quickly. This can help to speed up market development and allow the company to use the experience curve to improve their efficiency and lower their costs over time. By dominating the market with a low price, the company can potentially create barriers to entry for competitors and establish a strong position in the industry.

Penetration Pricing Attempts to Hasten Market Development and Offers the Pioneer