Consumers buy water and soda from vending machines. Traditionally, the price of each of these products is about $1.25. If a marketer charges a significantly higher price for such products dispensed by vending machines, such as $2.00 per item, sales are likely to decline. In order to avoid declines in sales, marketers tend to be very consistent in the prices they charge for vending machine products. This is an example of marketers employing a __________ strategy.

Question

Quizplus · Accepted Answer

This is an example of customary pricing, where the price of a product is set based on what customers expect to pay for it. In this case, customers have come to expect water and soda to cost around $1.25 from a vending machine, and deviating too much from that price would likely result in decreased sales.

Consumers Buy Water and Soda from Vending Machines