Search results

Maintains that, in multi‐product companies, frequently it is the case that decisions taken on the price of one product will have implications for other products in the range. Controversy has frequently centred on the role that costs should play in determining price. Discusses attempts to overcome problems in pricing by use of a marginal cost approach rather than a full cost approach, therefore allowing the pricing decision to become one of attempting to maximize the contribution the product will make — the difference between price and the direct and attributable costs. Posits that product costs become irrelevant to pricing decisions even though they are highly pertinent to the decision's profitability. Examines price as one of the simplest ways of segmenting markets, stating that price segmentation can become far more effective when based on value‐in‐use.

Marketing textbooks tend to follow economic theory in their discussions of pricing, but in the real world pricing is an alchemical mixture of costs, competition and consumer psychology. This paper presents experimental evidence that, for at least some purchase situations, consumers' expectations of what a thing ought to cost may be a better predictor of choice between offerings than are the predictions from two well‐known theories relating price to consumer behavior. The paper discusses sources of consumer price expectations and ways they are influenced, and it suggests how to improve profits by basing prices on consumers' expectations.

Customer location is a market‐limiting factor for the great majority of manufacturers. Under any full‐cost pricing system, companies are at their most competitive on their own doorstep and their appeal to the consumer diminishes as both the buyer's distance from the plant and the delivered price of products increase. For heavy industrial goods with a low value to weight ratio this is particularly true. The geography of actual and potential markets determines to a great extent the delivered price at which a firm is able to offer its products for sale and, as a consequence, the degree to which any particular market is exploitable.

In the affluent 1960s and 1970s, consumers tended to be price insensitive. Business consequently placed a low priority on pricing, and marketing educators in the USA responded by stressing the non‐price elements of the marketing mix. As a result, when consumers became more price sensitive in the 1980s and 1990s, and business became more concerned about pricing, marketing was not involved. Now, however, marketing educators are beginning to respond to the renewed emphasis on price as a key component in consumers’ perceived value. A new study shows an increase from 4 to 13 percent of US marketing education programs now including a course in pricing; another 22 percent are interested in adding one within two years.

As the retail banking market becomes more price competitive in terms of the products and services offered and as the introduction of new technologically based products breaks down the traditional homogeneity of bank products, so banks must necessarily move towards a position where they either adopt largely explicit and rational pricing policies, or alternatively introduce policies that both reinforce customer loyalty and obtain a substantial long‐term return from the totality of the relationship with the customer. In recognising and analysing this problem, the major implications for banks′ cost structures, and the way in which they price their products and organise their business activities are assessed.

All pricing strategies are composed of two elements: price structures and price levels. Price levels are the actual dollar prices that are set within the structure. But managers who merely set price levels rather than explicit price structures for their products deprive themselves of a valuable strategic tool.

Looks at the language of price, which is the conclusion that customers reach after learning of a company’s price structure and billing policies. Stresses product managers and marketers know that price messages need to address a number of audiences. States that lack of attention to price structure means that it may be difficult to construct the right message to send to decision makers. Concludes pricing and billing should reinforce company messages, sent in sales presentations and advertisements.

Common methods for pricing research ask respondents to evaluate multiple pricing scenarios. Likely respondents can allow some carry‐over to occur from one scenario to the next. In a study wherein such carry‐over conflicts with the objectives of the research a different experimental design will be more appropriate. Moderated choice experimental designs are introduced and illustrated in a study of every day low price pricing of a consumer durable good. Substantive conclusions about durable goods pricing strategies and about moderated choice experiments are reported.

Astute competitors are turning to the flip side of cost—price—for the next wave of performance enhancement.

The purpose of this paper is to investigate whether or not the offer price affects the transaction price and the number of days the property is on the market. Specifically, is it possible for the broker to use the offer price as an instrument for obtaining a higher transaction price?

To test the hypothesis the general hedonic model is used, where the deviation of the transaction price and expected price from the offer price is a function of time on the market.

The results indicate that a high offer price is more likely to result in a high ratio of transaction price to expected price compared to a low offer price.

However, the overall conclusion is affected by the state of the market, that is, whether the market is static, rising or falling.

The best selling strategy in a rising market seems to be set a high offer price compared to the expected sale price.

The main contribution is that the paper not only analyzes the relationship between offer and transaction price, but also its relationship to expected price. It also tests for the existence of spatial autocorrelation, which is unique in this type of study.