MARKETING! Marketing mix! This term refers to the key elements a business uses to meet the customers needs and wants. Price is one main elements and links between demand and supply. Its give the customers an idea about the quality of the product. This is connected with the other strategies of the marketing mix (Product, Place, Promotion, Price.) “A pricing strategy is a company’s plan for setting its prices over the medium to long term.” (Hussain, 2015)

Pricing Strategy Name: Penetration pricing
Company & Product that uses this strategy: Famous companies like Wal-Mart use this strategy while selling their products like shampoo and conditioners.
Explanation of the strategy: Penetration pricing is used when a company joins a market late and there are already similar products available. To gain market share a lower price is set and once it is established a higher price can be set. Cheaper prices can get them higher sales and that recover the cost as business benefit for bulk buying.
Advantages and disadvantages of using this strategy (analysis): Organizations use this strategy to gain customers and increase their sales. Another advantage of this strategy is it can also reduce competition as weak competitors might withdraw. The disadvantages include if they plan to increase the price customers would switch to another company so it is harder to increase prices. Moreover, some customers might are brand conscious and would not like to switch brand even if the prices are lower.