Archives posted in: Pricing
Salespeople abuse discounts. Pricing is the sales destruction department. Well, which group is right and must they keep fighting? In this article, we explore the role of price segmentation in strategic account selling.
More In a marketing blunder that rivals Coca Cola’s (temporary) abandonment of its original formula in favor of the sweeter “New Coke,” Netflix (NFLX), despite its incredible success and customer affection, decided to raise its prices 60 percent. Stock tumbled 19 percent. One million customers instantly abandoned Netflix. Was this incredible greed, stupidity or just plain ignorance?
More Groupon has shown the world a new way to do coupon promotions, but is it any better than traditional couponing? In this article, provide an academically proven and industry best-practice approach for evaluating coupon promotions, be it Groupon or any other type of couponing.
More Preventing the Resale of Sporting Event Tickets
StubHub, TicketNetwork, and eBay are marketplaces that allow customers to buy and sell unwanted tickets. For example, a season ticket holder uses StubHub as form of consignment to sell a Dallas Mavericks basketball ticket to a consumer that is available and willing to attend the game. The sellers of tickets in the secondary market are capitalizing on possessing elastic demand characteristics. But what about the team owners?
More Last year, a Malaysian executive told me that she must compete on price because Malaysians only buy on price. This year, an Indian executive told me that he only sells commodities because that’s what his nation buys. On both occasions, I countered with a strong push to find ways of meeting their customer’s needs better to reduce downward price pressures associated with selling commodities.
More As the global economy continues to be stressed and prices for all kinds of raw materials continue to rise, manufacturers are looking for ways to preserve profits. Although manufacturers are substituting materials where they can and locking in long-term contracts to protect themselves from price hikes, they may ultimately face the conundrum of passing along rising costs in the form of price increases to their customers. Will it work? Mixed results.
More At the beginning of the Great Recession, Abercrombie & Fitch (ANF) had a clear policy against price promotions. By the end of the Great Recession, price promotions were clearly part of Abercrombie & Fitch’s retail strategy. What changed? Was Abercrombie & Fitch’s price promotion policy shift simply another shoot-from-the-hip shotgun response to declining sales, or was it a needed change to improve growth and profits?
More As health care spending consumes a greater and greater share of the nation’s economic output in the future, Americans will be faced with increasingly difficult choices between health care and other priorities. However, a number of opportunities exist to constrain health care costs without adverse health consequences.
More It’s once again that time of year where the kids are out of school, the stress of work is weighing us down and the thought of a relaxing getaway is on our minds. As we begin to investigate the options there are many factors we need to consider including costs, time constraints and of course destination. Unfortunately, a large majority of us don’t live in Hawaii, next to a four star resort or a world-class golf course. That means we have to get into a car, board a plane, find a train, ship or some other form of transportation to get to where we are going. After you consider all of the options – even with the inconveniences of security, over crowded flights and additional fees – you may find yourself with one viable alternative – air travel.
More As a customer of the Amazon online marketplace and self proclaimed elastic demander of new books in all forms and genres, I find myself intrigued by the pricing segmentation strategies employed. Forcing the consumer to self-identify their willingness to pay using tactical segmentation hedges circumvents the blind online interface between the customer and firm. The consumer’s marginal benefit is indirectly discovered by the time of purchase and method of delivery. Essentially, Amazon has captured a significant array of customers at different pricing points for the same desired good, resulting in revenue outcomes more consistent with quasi-complete price segmentation.
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