Low-Price Strategy

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Low-Price Strategy

In marketing, a strategy in which a newcomer to a market establishes a low price for products, especially when there is already significant competition. This can be advantageous when the seller must rely on high volume for profit; that is, even though profit margins would be low, the net income would still be high because of the large number of sales. A low-price strategy also helps create market share.
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The commercial campaigns and low-price strategies are exacerbating the situation and making it difficult for market participants to expand service penetration without compromising the return on investment.
Suppliers and marketers in the household and personal products industry have bemoaned Wal-Mart's low-price strategies for years.
At the same time, these low-price strategies were mainly applied in the case of two-weekly/monthly disposable contact lenses subsector, which is the most mature of the three, in which innovation and added value are currently lower and mark-ups still relatively high.
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