Marketing

Table of Contents

1. Topic pack - Marketing - introduction
2. 4.1 The role of marketing - notes
3. 4.1 The role of marketing - questions
4. 4.2 Marketing Planning - notes
5. 4.2 Marketing planning - questions
6. 4.3 Product introduction - notes
7. 4.3 Product - questions
8. 4.3 Product - simulations and activities
9. 4.4 Price - notes
   1. Price
   2. Summary of pricing strategies - SL
   3. Summary of pricing strategies - HL
   4. Cost-based strategies
   5. Cost-plus pricing (mark-up pricing)
   6. Marginal cost pricing
   7. Pricing - Contribution pricing
   8. Pricing - Absorption cost and full cost pricing
   9. Competition-based pricing
   10. Price leadership
   11. Predatory pricing
   12. Going rate pricing
   13. Market-based pricing
   14. Penetration pricing
   15. Skimming pricing
   16. Price discrimination
   17. Loss leader
   18. Psychological pricing
   19. Promotional pricing
   20. Supply and demand
   21. Elasticity
   22. Elasticity and sales revenue
   23. Price elasticity and the product life cycle
   24. Income elasticity of demand (YED)
   25. Cross elasticity of demand (XED)
   26. Advertising elasticity of demand (AED)
10. 4.4 Price - questions
11. 4.4 Price - simulations and activities
12. 4.4 Promotion - notes
13. 4.5 Promotion - questions
14. 4.6 Place (distribution) - notes
15. 4.7 International marketing - notes
16. 4.7 International marketing - questions
17. 4.8 E-commerce - notes
18. 4.8 E-commerce - questions
19. Printable version

Going rate pricing

Going rate pricing is most likely to occur where:

• there is a degree of price leadership taking place within a particular market
• businesses are reluctant to set significantly different prices because of the risk of setting off a price war, which would reduce profits to all firms
• there is a degree of collusion taking place between firms

If there is one price leader and firms are tending to follow the prices set by the price leader, then they will often feel frustrated that they are not able to mark themselves out by reducing their prices. To compensate for this, they may try, through their marketing strategy, to establish a strong brand identity. This will enable them to differentiate themselves from the competition.