Since custom home builders are price-insensitive and are willing to pay for customization, Arbol Industries charged this segment prices based on
A) a commodity index.
B) competitor prices.
C) a bundled offering.
D) a premium pricing strategy.
E) cost-plus pricing.

Question

Quizplus · Accepted Answer

Custom home builders are price-insensitive and willing to pay for customization, which makes them a target segment for premium pricing strategies. Therefore, Arbol Industries charged this segment prices based on a premium pricing strategy, which allows them to capture a higher profit margin due to the perceived value of customization.

Since Custom Home Builders Are Price-Insensitive and Are Willing to Pay