Which of the following, if true, would be most likely to contribute to the chanc

Question

Which of the following, if true, would be most likely to contribute to the chances that a skimming price strategy would prove successful?

A) the target consumers of the product in question are highly price-sensitive.
B) available supply of the product exceeds demand
C) the place strategy used for the brand is intensive distribution.
D) the brand uses the lowest cost method of transportation for the product.
E) it will be fairly complicated and time-consuming for competitors to enter the market.

EXPLAIN YOUR ANSWERS

Explanation / Answer

The iPhone is a perfect example of this strategy. When it was introduced in 2007, the original iPhone sold for $499 for a 4GB version and $599 for an 8GB version. Two months later, the company reduced the price of the 8GB version by $200. The main goal of price skimming is to ride the demand curve all the way down, so that with each new price, you are able to “skim” customers off that level.

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