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Differentiate between price skimming and price penetration technique of pricing.

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Price SkimmingPrice Penetrating
1.Goods are sold at higher prices so that fewer sales are needed to break even.Price is initially set at a price lower than the eventual market price to attract new customers.
2.It is usually employed to reimburse the cost of investment of the original cost It has a marketing objective of increasing market share rather than to earn profit.
3.It is used to target ‘early adopters’ of a product or service.It works on the expectation that customers will switch to the new brand because of the low price

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