Marketing Management, 16th Edition

Understanding Pricing

Price is not just a number on a tag. The prices you pay for goods and services perform many functions and come in many forms: rent, tuition, fares, fees, rates, tolls, retainers, wages, and commissions. Price also has many components. If you buy a new car, the sticker price may be adjusted by rebates and dealer incentives. Some firms allow customers to pay through multiple forms, such as using points, frequent flier miles, and bitcoins.

Throughout most of history, prices were set by negotiation between buyers and sellers. Bargaining is still a sport in some areas. Setting one price for all buyers is a relatively modern idea that arose with the development of large-scale retailing at the end of the 19th century. F.W. Woolworth, ...