Many consumers are willing to pay $100 for a perfume that contains$10 worth of scent because the perfume is from a well known brand.what kind of pricing is the company depending on.?
Answers
Answer:
Price is 90$
Explanation:
100$-10$=90
Answer:
The pricing strategy that the company is using in this scenario is called premium pricing. Premium pricing is a strategy where a company charges a higher price for its products or services compared to its competitors.
Explanation:
This pricing strategy is often used by companies that have a strong brand image and reputation, as customers are willing to pay more for the perceived value and quality of the product.
In the case of perfume, the well-known brand has a strong reputation for producing high-quality products, which makes consumers more willing to pay a premium price. Even though the actual cost of the scent used in the perfume may be much lower, the brand value adds to the perceived value of the product, allowing the company to charge a higher price.
Premium pricing can be an effective strategy for companies that have a strong brand image, a unique product, or a loyal customer base. However, it can also be risky, as it may alienate price-sensitive customers and attract competition.
Therefore, companies need to carefully consider their pricing strategy and market positioning to ensure that they are maximizing their profits while still meeting customer needs and expectations.
To know more about the concept please go through the links:
https://brainly.in/question/7613241
https://brainly.in/question/22661570
#SPJ3