The manufacturer of a Blu-Ray-R,a recordable Blu-Ray disk that can be erased and reused,is thinking of using a skimming pricing strategy for its new product.Which of the following conditions would argue AGAINST using a skimming pricing strategy for the Blu-Ray disks?
A)large potential market, even at a high price
B)technological problems still exist for competitors
C)increasing volume reduces production costs substantially
D)consumers perceive a price-quality relationship

Question

Quizplus · Accepted Answer

Skimming pricing strategy is used when there is low initial demand for a product and the target market is willing to pay a higher price for the product. However, if increasing volume reduces production costs substantially, it may not be the best strategy to use. In this case, the manufacturer will benefit more from using a penetration pricing strategy to quickly capture market share and drive competitors out of the market. On the other hand, a large potential market, technological problems for competitors, and consumers perceiving a price-quality relationship would support the use of a skimming pricing strategy.

The Manufacturer of a Blu-Ray-R,a Recordable Blu-Ray Disk That Can