Okuzeka
Marketing vocabulary · Pricing

Penetration pricing

Meaning in marketing, with examples

nounCommon term

In marketing, penetration pricing means: Launching a product at a low price to attract many customers quickly and win market share, often with a plan to raise the price later.

In Turkish: pazara nüfuz fiyatlandırması, penetrasyon fiyatlandırması

How it is used

Common for subscriptions, apps and new brands entering crowded markets. The risk is that customers may leave when the price goes up. It is the opposite of price skimming.

Example sentences

  1. The streaming service used penetration pricing: the first year was half price.

  2. Penetration pricing helped us win share, but our margins are very thin.

Common collocations

  • penetration pricing strategy
  • use penetration pricing
  • introductory price
  • low launch price
  • price skimmingLaunching a new product at a high price for customers who want it first, then lowering the price over time to reach more price-sensitive buyers.
  • pricing strategyThe method a company uses to set and change its prices, based on its costs, its competitors, the value customers see and its business goals.
  • market shareThe percentage of all sales in a market that one company or brand makes, measured either by sales value or by the number of units sold.
  • launchTo make a new product, service or campaign available to the public for the first time, usually with planned promotion around it.

More terms: Pricing

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