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? Psychological ? Promotional ? Geographical ? International ? Types of discounts ? Cash discount ? Quantity discount ? Functional (trade) discount ? Seasonal discount ? Allowances ? Tradein allowances ? Promotional allowances Strategies 8 Price Adjustment Strategies ? Discount / allowance ? Segmented ? Psychological ? Promotional ? Geographical ? International ? Types of segmented pricing strategies: ? Customersegment ? Productform pricing ? Location pricing ? Time pricing ? Also called revenue or yield management ? Certain conditions must exist for segmented pricing to be effective Strategies 9 Conditions Necessary for Segmented Pricing Effectiveness Price Adjustment Strategies ? Market is segmentable ? Lower priced segments are not able to resell ? Competitors can not undersell segments charging higher prices ? Pricing must be legal ? Costs of segmentation can not exceed revenues earned ? Segmented pricing must reflect real differences in customers’ perceived value 10 Price Adjustment Strategies ? Discount / allowance ? Segmented ? Psychological ? Promotional ? Geographical ? International ? The price is used to say something about the product. ? Pricequality relationship ? Reference prices ? Differences as small as five cents can be important ? Numeric digits may have symbolic and visual qualities that psychologically influence the buyer Strategies 11 Price Adjustment Strategies ? Discount / allowance ? Segmented ? Psychological ? Promoti