Price, place and promotion
| English | Chinese | Pinyin |
|---|---|---|
| cost-plus | 成本加成 | chéng běn jiā chéng |
| penetration | 渗透定价 | shèn tòu dìng jià |
| skimming | 撇脂定价 | piē zhī dìng jià |
| competitive | 竞争性定价 | jìng zhēng xìng dìng jià |
| psychological | 心理定价 | xīn lǐ dìng jià |
| distribution | 分销 | fēn xiāo |
| wholesalers | 批发商 | pī fā shāng |
| channel | 渠道 | qú dào |
| above-the-line | 线上广告 | xiàn shàng guǎng gào |
| below-the-line | 线下促销 | xiàn xià cù xiāo |
| sales promotions | 销售促进 | xiāo shòu cù jìn |
Getting it to the customer at the right price
- A product is ready — now, what price, sold where, promoted how? Three of the four Ps decide whether it sells.
- Each must fit the product, the market and the others.
Marketing mix lab
See which part of the marketing mix changes in each real decision.
Setting a low price to win market share quickly is:
Penetration pricing uses a low price to gain share.
Launching at a high price for keen early buyers, then lowering it, is:
Price skimming targets early adopters first.
Adding a fixed profit margin to the unit cost is ______-plus pricing.
Cost-plus pricing adds a margin to cost.
Price strategies
- Cost-plus 成本加成: add a margin to cost. Penetration 渗透定价: low price to win share.
- Skimming 撇脂定价: high launch price for keen early buyers. Competitive 竞争性定价 and psychological 心理定价 pricing.
Penetration pricing starts low to win share; skimming starts high then falls over time
The same price fall raises quantity a lot when demand is elastic, little when inelastic
In the marketing mix, "place" refers to:
Place is the distribution channel.
Place (distribution 分销)
- Place is how the product reaches the customer: shops, wholesalers 批发商, or direct/online.
- A shorter channel 渠道 gives more control; a longer one gives wider reach.
A short channel sells direct for more control; a longer channel adds wholesalers and retailers to reach more buyers
Above-the-line promotion uses paid mass media such as TV adverts.
Above-the-line = mass media; below-the-line = targeted methods.
Promotion
- Above-the-line 线上广告: paid mass media (TV, online ads) — wide reach.
- Below-the-line 线下促销: targeted methods (sales promotions 销售促进, direct mail, sponsorship, social media).
Worked example. A new phone uses skimming (high launch price), sells direct online for control, and promotes with social-media influencers (below-the-line) — a mix tuned to tech-keen early adopters.
You've got it
- price strategies: cost-plus, penetration, skimming, competitive, psychological
- place = the distribution channel (direct vs through intermediaries)
- promotion: above-the-line (mass media) vs below-the-line (targeted)