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in response to duracell's introduction of the duracell ultra battery, energizer introduced an advanced formula battery. but unlike duracell, energizer priced its batteries at a low initial price, believing that consumers were too price sensitive to pay more in this category. in this case, energizer used

a penetration pricing.

b prestige pricing.

c skimming pricing.

d price lining.

e cost-plus-fixed-fee pricing.

The correct answer is (A) Penetration pricing.

Explanation:

In this type of pricing, a product is initially priced low to quickly reach a large part of the market and to encourage the word of mouth marketing from consumers. This strategy works with the expectation that customers will be attracted to the new brand due to the low price. But in the case of batteries, the customer compares quality with a high price (Auger et al., 2010). So, this will not be considered as a successful pricing approach from Energizer.

Reference

Auger, P., Devinney, T. M., Louviere, J. J., & Burke, P. F. (2010). The importance of social product attributes in consumer purchasing decisions: A multi-country comparative study. International Business Review, 19(2), 140-159.

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