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Premium refers to a segment of a company's brands, products, or services that carry tangible or imaginary surplus value in the upper mid- to high price range. [2] [3] The practice is intended to exploit the tendency for buyers to assume that expensive items enjoy an exceptional reputation or represent exceptional quality and distinction.
Pricing is the process whereby a business sets and displays the price at which it will sell its products and services and may be part of the business's marketing plan.In setting prices, the business will take into account the price at which it could acquire the goods, the manufacturing cost, the marketplace, competition, market condition, brand, and quality of the product.
Examples of variable characteristics are: interest rates, location, date, and region of production. The sum total of the following characteristics is then included within the original price of the product during marketing. Variable pricing enables product prices to have a balance "between sales volume and income per unit sold". [32]
Free premiums are sales promotions that involve the consumer purchasing a product in order to receive a free gift or reward. An example of this is the ‘buy a coffee and receive a free muffin’ campaign used by some coffee houses. Self-liquidating premiums are when a consumer is expected to pay a designated monetary value for a gift or item.
Product line pricing is a product pricing strategy, used when a company has more than one product in a product line. [10] It is a process that traders adopt to separate products in the same category into various price groups, to create different quality levels in the customers’ minds.
Trade Promotion refers to marketing activities that are executed in retail between these two partners. Trade Promotion is a marketing technique aimed at increasing demand for products in retail stores based on special pricing, display fixtures, demonstrations, value-added bonuses, no-obligation gifts, and more. [2]
A product or brand may have many points of difference, but they may not all be meaningful or relevant to the target market. Positioning is something (a perception) that happens in the minds of the target market whereas differentiation is something that marketers do, whether through product design, pricing or promotional activity. [31]
Market cannibalization, market cannibalism, or corporate cannibalism is the practice of slashing the price of a product or introducing a new product into a market of established product categories. If a company is practising market cannibalization , it is seen to be eating its own market and, in so doing, hoping to get a bigger share of it.