The strategy of launching new products with high prices and little promotion is called slow skimming or slow launch strategies.
Indeed, there are several types of strategies that companies can use in launching a new product.
But is it possible for the company to market a new product at a high price while the promotion the company does is low? What is the explanation? Friends, please refer to the following article.
What is Slow Skimming
Slow skimming is a new product launch strategy by setting a high price on a product and doing little promotion.
When can the Company use this type of strategy?
Companies can use this strategy if the target market is on a small scale, then the product already has brand awareness, which means that the target consumer has realized or understood the value of the product.
In addition, the target market for these products is consumers with middle to upper economic backgrounds. Or who are willing to pay a high price.
Then in terms of competition, the existence of competitors in the same market is considered not threatening enough.
Slow Skimming Goals
The slow skimming strategy or which in Indonesian has the meaning of a slow launch strategy has the following objectives.
High pricing aims to get the maximum profit from each product unit. One of the things the company does is if the same market does not have potential competitors.
Meanwhile, the decision to carry out minimal promotion has the aim of reducing promotional costs in order to get an increase in net profits from product sales.
In accordance with the law of supply and demand or demand and supply, if the demand or demand for a product is high while the supply or availability is low, the price of the product will increase even more.
This is because consumers who really want the product cannot find the same product or with the same quality in other brands or places.
Example of Slow Slimming
One example of a slow skimming strategy is on Nokia phones. Nokia is one of the mobile phone brands that once dominated the market in 2003 until several years later.
Due to the lack of strong competition in the same market, at that time all the latest mobile phones from the Nokia brand will always sell well. No matter what design Nokia creates, there will still be consumers who are chasing it.
Even though the strange shapes that Nokia launches, such as in the Nokia 3650 series whose keypad is in a circle or on the Nokia 7610 which is diamond-shaped. Even up to the Nokia 7280 which is shaped like a lipstick, consumers will still buy it, because at that time the brand was very popular.
The lack of competition, high demand, and the goods they market are electronic goods that are reasonable if the price is expensive, making the Nokia brand very suitable for using this slow skimming strategy.
Disadvantages of Slow Skimming
The slow skimming strategy has a number of drawbacks, including that it usually doesn’t last long.
This strategy can only be carried out by a company if there are no potential competitors entering the same market.
If a competitor has entered the same market, then that competitor will start selling goods of equal quality at a lower price.
Which makes the market able to absorb goods faster which has an impact on goods circulating everywhere.
As in the previous example regarding Nokia, which uses a price skimming strategy. Nokia, which at that time used the Symbian operating system, was defeated by the Android system.
At that time the Google company made an Android-based system and offered the system to be freely used by various vendors of any mobile phone company.
So that in a short time the mobile market began to be dominated by Android. In a short time, Nokia, which was independent, was defeated by Google, which took a very large number of other mobile phone companies.
Friend, so the strategy of launching a new product with a high price and little promotion is called a slow skimming strategy. Hopefully my friend can understand more about the material and see you later.