Sign In

The two key pricing strategies in marketing are EDLP-Everyday Low Pricing Strategy and High/Low Pricing Strategy.

  1. Everyday Low Pricing (EDLP): Companies consistently set a relatively low price for products in this pricing strategy. The approach is to attract customers who appreciate the simplicity and stability of prices, eliminating the need for constant sales or discounts. Walmart is a classic example of a retailer that uses the EDLP strategy. The benefit of this strategy is that it can build customer loyalty and simplify inventory management. Conversely, it may not generate the same sense of urgency as sales promotions.
  2. High-Low Pricing: Unlike EDLP, high-low pricing involves setting prices higher than the competition but offering frequent promotions and discounts. The objective is to attract consumers driven by "bargains" and enjoy the "hunt" for discounted items. This strategy can create excitement and attract large sales volumes during promotional periods. On the flip side, it can also create an expectation for discounts, meaning regular-priced items may be ignored.

Both strategies have pros and cons, and the choice between them depends on a firm's overall marketing strategy, target audience, and product positioning.

Tags

Pricing StrategiesEDLPEveryday Low PricingHigh low PricingPricingPricing ModelsPricing ApproachesMarketing StrategiesRetail PricingDiscountsPromotions

From Chapter 6:

article

Now Playing

6.6 : Pricing Strategies

Capturing Customer Value: Price to Exchange

211 Views

article

6.1 : Price and Exchange

Capturing Customer Value: Price to Exchange

297 Views

article

6.2 : The 5 c's of Pricing

Capturing Customer Value: Price to Exchange

526 Views

article

6.3 : Internal Considerations Affecting Price Decisions

Capturing Customer Value: Price to Exchange

248 Views

article

6.4 : External Considerations Affecting Price Decisions

Capturing Customer Value: Price to Exchange

216 Views

article

6.5 : Pricing Methods

Capturing Customer Value: Price to Exchange

378 Views

article

6.7 : Pricing Tactics I

Capturing Customer Value: Price to Exchange

130 Views

article

6.8 : Pricing Tactics II

Capturing Customer Value: Price to Exchange

117 Views

article

6.9 : New-Product Pricing Strategies

Capturing Customer Value: Price to Exchange

143 Views

article

6.10 : Product Mix Pricing Strategies I

Capturing Customer Value: Price to Exchange

176 Views

article

6.11 : Product Mix Pricing Strategies II

Capturing Customer Value: Price to Exchange

415 Views

article

6.12 : Price Adjustment Strategies I

Capturing Customer Value: Price to Exchange

470 Views

article

6.13 : Price Adjustment Strategies II

Capturing Customer Value: Price to Exchange

261 Views

article

6.14 : Price Changes

Capturing Customer Value: Price to Exchange

125 Views

article

6.15 : Public Policy and Pricing

Capturing Customer Value: Price to Exchange

388 Views

JoVE Logo

Privacy

Terms of Use

Policies

Research

Education

ABOUT JoVE

Copyright © 2025 MyJoVE Corporation. All rights reserved