Pricing strategy is a critical element of the marketing mix that directly impacts sales, profitability, and market positioning.
Key approaches include cost-plus pricing (adding markup to costs), competitive pricing (matching competitors), value-based pricing (based on perceived value), and penetration pricing (low price to enter market). Xiaomi used penetration pricing to quickly capture smartphone market share.
The right pricing strategy depends on your brand positioning, target market, and business goals. Premium brands must price high to maintain exclusivity, while mass-market brands compete on affordability.