Pricing Strategies

Pricing Strategies – skimming, penetration, loss leaders, price points

Skimming: Charge the highest price possible for new, innovative products, which is gradually skimmed.

Penetration: Charge the lowest price possible to quickly achieve a large market share.

Loss Leaders: Sell a product below its cost price to attract customers to the business.

Price Points: Where a business may offer various qualities of a product at different prices in order to appeal to different peoples’ budgets eg phone plans.


Extract from Business Studies Stage 6 Syllabus. © 2010 Board of Studies NSW.