How to Fight a Price War By Akshay R. Rao, Mark E. Bergen and Scott Davis IN THE BATTLE TO CAPTURE THE CUSTOMER companies use a wide range of tactics to ward off competitors. Increasingly, price is the weapon of choice – and frequently the skirmishing degenerates into a price war. Creating low price appeal is often the goal, but the result of one retaliatory price slashing after another is often a precipitous decline in industry profits. Look at the airline price wars of 1992. When American
Words: 6913 - Pages: 28
The Problem: Biopure Corporation has two new products that are Oxyglobin and Hemopure. Oxyglobin is the first new blood substitute for the veterinary market and is ready for consumer use. Hemopure is another new blood substitute for the human market and it will take two years to launch the product from now on. Ted Jacobs, vice president for Human Clinical Trials, is concerned about creating an unrealistic price expectation for Hemopure by marketing Oxyglobin before Hemopure. On the other hand, Andy
Words: 663 - Pages: 3
Introduction The strategy cost involved in setting up a business that provides a customer service, market service of setting a business of a product. In this paper, we discussed the comprehensive analysis of the existing product on the market, then indicating my own business analysis that fits in the existing market. The paper also discussed the financial information of the existing product and a new product. The paper also highlights the vital role playing by the product owner in setting a business
Words: 3177 - Pages: 13
the stated costs associated with the product or service many internal and external factors affect price. Internal factors include the firm’s marketing objectives, marketing mix strategy, and organizational factors. External factors that influence pricing decisions include the nature of market and demand, competition, and other environmental factors like the economy, reseller needs, and government actions. In the end, the consumer decides whether the company has set the right price. If companies
Words: 578 - Pages: 3
Marketing Strategy New Evolution Sdn. Bhd’s marketing strategy in Malaysia is based on a positioning consumer of product differentiation. Our main consumer target is both male and female that is classified into a few categories. These include travelling individuals, teenagers, officers, athletes and corporate workers. Our product, EasyMade are suitable for everyone and safe. Our product is also targeted for consumer that age between 13 to 45 years old and also based on education level. Firstly
Words: 1050 - Pages: 5
public i.e. Celery, Spinach, Kale, Collard, Greens, Lettuce, Carrots, pumpkin, Cucumber and Mixed vegetable etc. We are delivering juices to our customer in different sizes, 250ml, 500ml & 1000ml. Penetration pricing strategy will be used with different pricing methods. Competition base pricing strategy will be applied on 250ml for the other available packages choices cost plus strategy will be used to get hold of the marketplace. The competitive advantage we have no existence of such product in
Words: 5274 - Pages: 22
1. Why was Dakota's pricing system inadequate for its current operating environment? Currently, DOP's pricing system is pricing products by adding markup twice, which is marking up the purchased product cost by around 15% to cover the cost of warehousing, distribution, and freight. Then add another markup to cover the approximate cost, for general and selling expenses, plus an allowance for profit. We found that the existing pricing system is inadequate regarding to following points: The
Words: 509 - Pages: 3
1 2 Price fixing is collusion among competitors to (1) sell a good or commodity at the same price, (2) use the same formulas for computing selling prices, (3) offer the same discounts, (4) keep the same price differentials between different order quantities, qualities, or types, and (5) not lower the prices without notifying other colluders. This harms both consumers and overall economic well being there are no consumer or social benefits from price fixing. 3 Resale price maintenance (RPM)
Words: 566 - Pages: 3
Strategic Transfer Pricing Author(s): Michael Alles and Srikant Datar Source: Management Science, Vol. 44, No. 4 (Apr., 1998), pp. 451-461 Published by: INFORMS Stable URL: http://www.jstor.org/stable/2634608 . Accessed: 15/08/2011 07:30 Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at . http://www.jstor.org/page/info/about/policies/terms.jsp JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build
Words: 8609 - Pages: 35
Table of Contents Introduction..............………………..………………………………...2 Pricing Strategy.............................…….………..…………………… 2 Non-price Barriers to Entry...……………..…...…………….……… 3 Ideas for Product Differentiation...……..………..……….………… 3 Markets………………….……………..................................………… 4 Profit Maximization.............................................................................5 Loss Minimization...........................................................................
Words: 1998 - Pages: 8
