A smartphone manufacturer introduced a new device into the marketplace with pricing set according to the skimming approach.The CEO of the company reviews financial reports from the device and notes that the pricing approach used is not cost-effective for the company.How should the CEO adjust the pricing strategy for this device?
A)drop the price
B)increase the price
C)offer an everyday low price option
D)remarket the device under a private label
E)match the price to the competitions' price

Question

A smartphone manufacturer introduced a new device into the marketplace with pricing set according to the skimming approach.The CEO of the company reviews financial reports from the device and notes that the pricing approach used is not cost-effective for the company.How should the CEO adjust the pricing strategy for this device? ​
A)​drop the price
B)​increase the price
C)​offer an everyday low price option
D)​remarket the device under a private label
E)​match the price to the competitions' price

Quizplus · Accepted Answer

The most appropriate choice for the CEO is to drop the price of the device. The skimming pricing approach may have resulted in initial high profits, but if it was not cost-effective for the company, it needs to be revised. Dropping the price would make the device more affordable and attractive for consumers, which could increase demand and ultimately lead to higher profitability.

A Smartphone Manufacturer Introduced a New Device into the Marketplace