Which marketing strategy focuses on low initial pricing for new products?

The strategy that emphasizes low initial pricing for new products is penetration pricing. This approach aims to attract customers by setting a price lower than competitors, thereby quickly gaining market share and encouraging widespread adoption of the product.

By setting a low introductory price, businesses can entice consumers who may be reluctant to pay higher prices for new items, which helps stimulate sales volume. As the product gains traction and market share increases, the company may later decide to adjust the price upward. This strategy is particularly effective in competitive markets where price sensitivity is significant among consumers, allowing the product to establish a foothold before potentially adjusting pricing strategies to maximize profitability.

In contrast, competitive pricing involves setting prices based on what competitors are charging rather than starting low to attract customers. Value-based pricing focuses on how much customers believe the product is worth to them, often leading to higher prices that reflect perceived value. Price skimming involves setting high initial prices and then gradually lowering them, which is the opposite of what is done in penetration pricing.