Certified Professional Category Analyst (CPCA) Practice Question

The choice that states EDLP provides everyday low prices, while High/Low promotes selectively lower prices accurately captures the essence of these two pricing strategies. Everyday Low Pricing (EDLP) is built on the premise of maintaining consistently low prices for a wide range of products throughout the year, which appeals to price-sensitive consumers who appreciate predictable pricing without the need for waiting for sales or promotions. This strategy fosters customer loyalty, as shoppers know they can expect lower prices without having to time their purchases around periodic sales. In contrast, the High/Low pricing strategy involves setting higher regular prices and then offering discounts or special promotions at various times, such as sales events or targeted marketing efforts. This approach creates a sense of urgency and encourages customers to make purchases during promotional periods, leveraging the psychological appeal of perceived savings. Understanding this distinction is crucial for analysts and retailers in determining the pricing strategy that aligns with their target market and business objectives.