Skimming Pricing Strategy Definition
When it comes to pricing strategies, skimming is defined as setting a high price for a product or service at first, and then gradually lowering the price over time. The goal of skimming is to maximize profits by targeting customers who are willing to pay more for a product or service, and then capture a larger share of the market as the price is lowered.
There are several factors to consider when implementing a skimming pricing strategy, including the overall demand for the product or service, the competition, and the costs associated with production. Additionally, it’s important to carefully monitor customer reaction to changes in price point in order to ensure that the desired effect is achieved.
When used correctly, skimming can be an effective way to increase profits and gain market share. However, it’s important to keep a close eye on customer reaction to ensure that the strategy is working as intended.
