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Title: Penetration vs skimming Pricing strategy

Essay Details

Subject: Business
Author:
Date: January 26, 1998
Level:
Grade:
Length: 6 / 1564
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(Tagamet was to lose patent protection in the United States in 1995, unleashing a flood of cheaper generics onto the American market.)6 Many new products are priced following this policy. Videocassette recorders (VCRs), frozen foods, and instant coffee were all priced very high at the time of their initial appearance in the market...

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But different versions of these products are now available at prices ranging from very high to very low. No conclusive research has yet been done to indicate how high an initial price should be in relation to cost. As a rule of thumb, the final price to the consumer should be at least three or four times the factory door cost...

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