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Customer oriented or perceived value pricing
There is an increasing trend to price the product on the basis of the customer's perception of its value. This method takes into account all other elements of the marketing mix and the positioning strategy of the firm as the value of the product is a function of all these variables. This method helps the firm in reducing the threat of price wars.
In fact, it can help the firm steer out the ugliest of price wars. But the key to this method is to correctly understand customer's perception of product value and not to overestimate the firm's product value. Marketing research can play an important role here.
Risk seeking: A risk seeker is a decision maker who is concerned in the best likely outcome no matter how small the chance that they might take place i.e. he takes high risks
limitation
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Trinco Ltd (Trinidad & Tobago-T&T) has been negotiating a contract with a potential customer in Jamaica. Before the negotiations started the Jamaican company agreed to pay $10,000
static budget
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