Price Skimming is a pricing strategy used by businesses to set a high price for a new or innovative product, gradually lowering the price over time. It targets consumers who are willing to pay a premium for the latest technology or unique features, so the business can recoup development costs quickly. The price is reduced over time to attract more price-sensitive customers to increase overall sales. Price skimming is often used for technology products like smartphones or gaming consoles. It is an important concept for GCSE Business students as it illustrates how businesses can strategically manage pricing to optimise revenue throughout a product's life cycle.
Examiner-written GCSE Business revision resources that improve your grades 2x
- Written by expert teachers and examiners
- Aligned to exam specifications
- Everything you need to know, and nothing you don’t
Share this article
written revision resources that improve your