Definition
Competition-based pricing sets prices according to rivals’ prices rather than internal costs or perceived value.

Introduction
Sometimes, the market leader’s price becomes the compass for everyone else.

Explanation

Price Matching – align with competitors.

Price Leadership – dominant player sets tone.

Going-Rate – average industry price adopted.

Key Takeaways

Works in mature markets with similar products.

Must avoid blind copying; add differentiation.

Real-World Case – Airline ticketing uses dynamic parity; most carriers peg within a range of each other’s fares.
Reference: https://www.iata.org