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If you have an unlimited supply, everybody knows that lots of people are using it, and there are no restrictions, that means it's not exclusive, not rare, and not limited. ... "Premium" is an artificial limit on something that is not actually limited, aimed at people who have higher expectations, and
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strategy involves setting the price of a product higher than similar products. This strategy is sometimes also called skim pricing because it is an attempt to “skim the cream” off the top of the market. It is used to maximize profit in areas where customers are happy to pay more, where there are no
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that carry tangible or imaginary surplus value in the upper mid- to high price range. The practice is intended to exploit the tendency for buyers to assume that expensive items enjoy an exceptional reputation or represent exceptional quality and distinction. A premium
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has a psychological association with premium pricing. The implication for marketing is that consumers are willing to pay more for certain goods and not for others. To the marketer, it means creating a
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The use of premium pricing as either a marketing strategy or a competitive practice depends on certain factors that influence its profitability and sustainability. Such factors include:
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or average income; especially the latter can be premium-aware but on the lookout for bargains. Frequently, companies will invent various (sub)brands to differentiate their
81:(e.g., when buyers have no independent basis to test claims of "exceptional quality" for a particular product or service—assuming the concept is well-defined to begin with);
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substitutes for the product, where there are barriers to entering the market or when the seller cannot save on costs by producing at a high volume.
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of one of the products or service artificially high in order to encourage favorable perceptions among buyers, based solely on the price.
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74% are on the hunt for a premium product at a discounted rate and love finding a luxury brand at half the cost
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Align prices with Value - You might already have a premium product but you are selling it at a commodity price
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The best way to position a product as a premium brand is with a high price
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237:"Here is How to Position Your Product as a Premium Brand"
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Premium brands are designed to convey an impression of
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into premium and general segments (as, for example,
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The disadvantages of this pricing strategy include:
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value for which the consumer is willing to pay extra
337:"Quality or price: What makes a product 'premium'?"
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272:"Prestige Pricing: Pros & Cons and Examples"
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369:"Luxury versus Premium - Luxury Detectives"
353:Vijay Vishwanath and Jonathan Mark (1997).
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255:"Taking a premium position in the market"
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324:therefore a higher perception of value.
319:"Exclusive, rare, limited, or premium?"
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99:Market dynamics such as the level of
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274:. Inevitable Steps. March 15, 2016
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257:. Austin AMA / slideshare.
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357:. Harvard Business Review.
339:. mycustomer.com. 2013.
253:Gerardo A. Dada (2012).
213:The Advertising Handbook
70:Strategic considerations
215:. New York: Routledge.
293:Smith, Gordon (1997).
239:. entrepreneur. 2016.
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297:. New York: Wiley.
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132:. Targeted
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101:competition
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198:References
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171:See also
134:customer
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389:Pricing
92:, or a
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36:Premium
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165:luxury
153:marque
146:Toyota
56:Luxury
40:brands
150:Lexus
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