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.
References in periodicals archive ?
Promotional Saturation: Because of the lower returns on trade promotion spending, manufacturers are only exacerbating the problem, often earmarking more trade dollars for everyday low price strategies. Thirty-six percent of shoppers rank paper circulars at the top of their list for impacting their shopping trips and what products they purchase, despite younger generations preferring digital to print, and newspaper deliveries continuing to decline.
Walmart is also interested in building scale in a number of the markets where it already operates, so that its everyday low cost and everyday low price strategies can work more effectively.
Low price strategies aim to develop competitive advantages based on cost efficiencies and offer products that are positioned in the lower-priced market segments.
Whereas previous research suggests that Hungarians have had difficulty acquiring financial resources, knowledge of how to integrate manufacturing with technology, and marketing skills necessary for low price strategies, they do have the knowledge needed to execute differentiation strategies.
partners would be more likely to pursue low price strategies. A review of the mean scores across both strategies reveals that regional partnerships place the lowest emphasis on low price strategies and they place the highest emphasis on premium price strategies.