Penetration pricing uses a low introductory price to build sales and market position quickly. It is an entry strategy, not simply a commitment to remain cheapest indefinitely. Low margins make a defined objective for the introductory stage essential.[1]
For a new item, test whether the attracted customers will also buy at a sustainable price. Include launch costs and subsequent behaviour. Numerous trial orders at an exceptional price do not establish adequate demand once that price increases.
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Compiled with AI assistance using public sources. General explanation, not individual legal or tax advice. Describing a concept does not mean Zoloo offers it as a feature.