Chaplere 2. . ow ; oo a strealegies: (4) Discounls & Bllousances$ Diseourt is durd es. Be has cd Manog'ng reduction in price on purechases perdad of dame. ore of loregere qual both posilive and negative ouleorne , Theree 15 9 risk of damaging the repulakon of Jhe breand and may be associated wetth “cheap”. Customers may get nko a habit of *usaiting" fore dascounk, before purchasing. Morceover, discounting can eae up burching dye preofl vmertain . AL the. peers discounting can be a useful tool 9 f a company cA> qo concessions in icefursn r > f suck as cohen the chreddenere agrees to San > 7 a longere aemireactslate “is walling te buy | ny Jruckload quantifies. . : i Ty pes of discounts’ )Quantih, discount: A price rteduchon do hes wre ee le e volumes, Quant; discoumls mul » 2 . e OtHenred equally to al) cushmens and | mustly —! discount, Mered toy manuda edurtert + seller. t ine ' he Une} exceed the coal sowings to dhan. c Eeecrm ple : $40 pere nil Pore Loesett ea wmere 4oo units; $9 per vet for 40 or . veil. S “WRasalioral” Discousl't alae “enhad “treads fg oematonal Dis. treade— channel cere Lunes Members if they vail pertoren * storing onal ¢ stch as sell y, © Seasonal Bis coun ¢ 5 Priee reduchon I buy ™Merechandise out of season, Hotels, molels - offere d iscount, those sho Or Services Ud) cash discount: A Proce reeddals RUT TQrirree 1 pay their bills promply A type oy “xornple i. Vo nel. Bo,luahich “means dhol althrousy. BSy seal ai ed Within 30 djs the taped 205 deduct igi 5p BAN sf. is paid usithin, lodiys,@BhMNowancest By erdbea A en th designed Jo yee reesellare Porch cipadion in special Preoa rar. | 1 BYousence eee also means preemol ona) /™Memey Paid by “monufochenens be reelewlers m™m reehurca, Son ors! 3 itéemeak 45 feadune dhe man fechas! 's product “In some y PNousances inelude: evade ©) treade ~in- allousances s A itey lye orale decreased trom the selling, preice of a nee asset} a erechange of old asset. Encemple! Autoonobile Trdustey uses His WAL of oblousance . ; » Promotional allowances : ns parchic! padi in odvercHatn Preeaream - reeagarcd dealers Lyd t and sales suppor} Bocomele ' Allowance fore creat, aid maintains an in-store display Ot en ~op odverchsing t allousane Pie' nc — —— ee ms Ags Pretets Prat psycheliag of prices ond economies; dhe pretee is say Somethin, about the preodual . Fore erample~ constimers, usually _ Pereeeive hig here priced preoducts as havios higher qrality. Wher they can judge the Qelity of x preoduel by examining ik or by calling oP Past erpercience usith ih, Preece legs te Sodan queality Bal uthen they canih judge quality as dhe leek the information ore bul ‘ becomes an important qerelity @> Payehatesia al © 58S) ders ih. \ nol stonply te Used do They Use > Prdeg Sanal, Anolhon Ospect of ‘ 1D tretercteenoe fel to ushen hens ak a Qiven Pree duct | athe f. Nee ice Y | tee termite: Pret might he forerieg ¥ . SJ ae Past a | wisking curcrcent prices , remembe ny al i oe litte ria . Prices, or ossessing, the buying .situobion!, Sellers!” can jnlivence, ore..use these leomsumera’ reference’ Pretees ushen seHing Preece, > + re et i Esxomple ; TD is) commen oe clothes shap to fetreeduco clethes of 0 Highe hah: i prieepe.g: FH. Bub Hen allere a feus creeks, they of fare S0-607. discount. Gonsumens Hunk they are | qethng a geod dead as they have a Soy, discount “on The reference preee . (2) Discreiminaterey Pricing ¢ Price disereiminadion Occurs when a company sells a preo duc or setrice ad ho: or mone Preces dhol de nol 2 reflead & pre porctionad) difference tn cess | Cor panies adjust thelre baste Prece Jo ade differences tn customers, preeducls, if Accomiod- & locodion’ and so on. Te fired degree charges a separ Price serio ination dhe ale price te each eushivnin depending. Sas inlensily Pa his or her demand , sellerFf 7Tn.secrn dacda: : A Aohion Lo oakley > ‘ at 5 Atgeree’ ee prided b ‘buyers the seller “ahora es? “Less > to buye : buy o laraere volume . Tn thi price discriminelens the selled charges ds fe cen}: amounls ts i 4 Perea cladses of buye red Jeares Ps, a5 jn the zt Following dasee: & Stslemers eq men! Priclog : Museums Ae oO louse re Mission fet shideok, gz 1 ys TS Produch Porn, cprtelng: Bia Bazan te ES Panay a In Many style, Fadretes and levels of Geely, Sells amen, shire Te Tay en ERG Some companion “pre, the Same Pree ducd ad. tes dif Rercceh 1 loased on4 ) oda Cola cates ox “adEfenent preee depends na A titheatha, \ the Consumerc (purchases thine Sine reshace rank, 0 fast-food resturant, oo ven di Se channel proiding » nm machine | TH Location Pedleing » A Meter varies th dad ee ne Preces according te audience prelerenes i dilferest® loeahone. AE Tre _prsiegs Pri Some hedete chareges less on tseekends or off Seasong , ) Preoduel — vnine prodeing (Near) (2b) , ) Produc} Une procing s refors to seling preices Octtoss an enhne pro duct Vine ! + Companies usally single preo dual , aa Mana ment mush delereming Lhe proce steps Jo seh bekuseen dhe vardous products in oul develop prroducl Vines reethern 4 Te preoducl Vee proc! x The price steps should take fh account cost 4s PRercences betuseen products jn a ling, Mere impertactty, they sheuld be count _h okkout fore ae bf differences nm customerc perccep Hons the Value of afferent Peadures. Exons, a sit Mr. Clean’ SX usash, Fecka sos . Gi &) Opbonal Preeducl 4 ee en Pricing s TE invelves car Usash provides — alc sds aia Priclia opHonad sold uth ly, 4 i a “a ore Accessory preeducts main preoduct, Eroumple _ reefs qervaters Come Gadh opkena) Maker, Here, companies to inelude in dhe Men as ophons | 2eplive = predict preg: selina a orig (fore preoduct thal rush be used ale | Gatlin a main proeduch euch as we ) Aames for a video mush decide uoliel a base prece and ual tore a lazor and ee ones2° : | Th dhe case of serevices . eaplve— preo duck! “prdcing - 'S called uso — Service ts broken into a Aro rdeble Usage rrale , parc pricing The pretce of xed, fee plus a | £ - ™ ky Use pay a tam ple— od APY amusement Parck, cs Pay anily Hebel charge plus addtional Les, Sor food and cher D--parck fesdieni's” @) By — product Prefeing s selling A price fons by - products a oredere ty rete dhe ~moin Preeducts pice more compelitive , Preo ducer, preoducts and services oflen, “generals by — Prtoducds | Usin, / by — preoduct Pricing the CoM pany seeks acmankel Gre yy hog Preeducl to hel, offiel the cos} of hum and help veke Ihe smain preeduct ms pe preeduch Lis ms el preofilab ie tureiey _ of! spot Preice of dhe competitte , The by — ves «an even duns, oud to be + breash indo cash .Am % Breereplé bh asag. sla! eo bys the Pverea wad king’ sperations ly” - Preefit tp b Y- pree darcy Nee oa ace : Goasto 2 even Oren ae peels . ; © Pred eines, eopnbiltied 2 ml pep een Severcol P tro duel 5 and olercing the bundle a a reduce, pretee . Breeenp la Cae reshounante bundle 4 | bureer, fee and sof. bres deol ok, a ‘combo “ Pree , fretce bund] Prtomele the sales of se can Pree durats mghh Teh ateerecde de wl combined - Price mush» be 3 irerls usasle room), “PsSumen, nang lo : } We Src 4 de get them) de bul, brat bande . ot sabeCYean)l2e) Promising conicumens o leew price aa e Need +o usait fore He salle price erenk on Comparison shepping . Th iso pretce rrewniageinan rmethed ore tactie hod enables Companies, brrands. and retailers to offere tei customers consistently lous priced preeducl . Tnelead of offering discounks, coupons and preemotions, companies freus on preeviding. customers culy louo- pretee prroducd. EBLP of Walrnarel-? Boling The enormous arcocsth. of walmarl and ik Success ‘s i Pricing steady. “The EpLp sheabeay Means Every day love Prices. The SO™MPANY Has been testing, is pricin . strates 4 reight Since th ‘oepds oy, devieded ficem the strentegy Housevert, the EdLp strategy dees mot suil ol ys ce)s} Lrcarsds and as they need dere testa Obhere streeng Hye . J and Deverae len! tee bo cushy lousere ‘pretees : \ LIT ave ‘tematned a key reevenv2 dret Fore Walmatel-. and mosh signi ticand benefit of dhe ED a5 iat higher demand. atte louder’ thas the compettten cacthonnerce usil] audomel lock L ones stones leading 4 compedi }ve ushemens ee qyoality Se i dan Tf ones Praces odvantag Toe Products ad | breands, they ees shay ley al 4, Moll Preaduet crohioh Means repeat Purcelae,, and Maher Preofitebsl fy | One key drawback of Epip sda may han te sactificg preofL Taree ing s Margins may be thinwen ol Wolmanl) bud overcall sales elven is such ao taal Lhe *} more foe aa ms fon the a lest margin “Peteversit allay ERStstrise , bin aE Wal ret te conhee | costs acreess ne business opercadions : = ou does Wal maret- conhree!l cosds 2 das — Conbedling praces Trequirres culling down opercahonal Epre formula has helped Welamare}- contre! Costs and perss an the benef. 4s dhe customens costs and other eXPanses. The ® use of bargaining power: A | of suppl orqe number Netes depend on Wal mare Lore a signi bean! pare! of dyetre » Walmnacred- hag oO sign cant Pee on the bobby } Tevenue ines oft ‘nLlvence, Walmmardl i is suppliers te seh does Coste Many times suppliers, outomede Pheice preece. Sses or move preeduchs, J, countries Mikel Ching vusherce cheaper labon ty averlLle vin order te Lretn cosk deun and ymatn fain Vir relationship wath Walmanl. these COmMPanies « Using. ‘Thats able to pressee, Ne De ae gg wo - @Lowere ek. costs? Te keep d 2 Prices fo ils custom ere, lous rae oi ie genenode a signifi carn} compel live Van — x | a Irae, Walsnrarel as kept cutting. dousn operational cools. Heusever, Hud dees nob» femply Hye OP ercahenal Anttcarted operations and brie od, m4 O99 - csostehd helped SemPpany. has sacri feed Reency, ear douen layrens ae Prvecesses hag Walemarel brein ¢ openahing “enepense emPany keeps ie Freer Jnad Waleranl. hes also focused Om supply chain Hid. logishes Managemen Vode contesl. The dvercheads lous. Bparel in a ™MOnnNer way ag weltiminalés costs and csastone of. fing. ; 4 A. Jecknolo gically advanced supply chet, as beset an fAdert | nvendony melws system and a well. maneted dshdbubor metusark Prot eeees| on savin bol me and pron hove also helped Wel met cute dotsan tavertorey Trenagement costs. (2) bipect Sourcing ¢ Toshead of buyin amiddlemens Walmart Sources Greaves preo duc. directly trom the menufichicenrs, Tus has ales helped Walmart } chimtnoles Unmeces sarcy cost and Since tt buys tn bulls il ean press Hem to cud deuen cost, uw) HS gh sales volume: Aeeplog Prices lous leg means Pinner profit merging. The sheen high, “eles overcome A olhee 's Just so Kio rss the cempany grifcantly Nigh. the same usould nol be Possible if Wel mar. chased f higher: proft mara ins , oe? sales volume ad Wel mart. useaknesses. The sales Volume Mel even ab lower mar preefiL level Ws 33r ; a Mop acpely “4 jo Pristine! nsedat! og gassrrd 1 adds ad P othe Maree” B ; preteing etary and Demand? good prescime if a triacn lis i on” ert with an vn derstanding. of hous re a oe x e q Perceeptons of “value affect” the proees y atte tas Tn cs Pay « Bok eonsumert and ndu shal. buyens 4, iG balance tHe preice aad 4 of a pred qotest de benels of cuore ‘La iThuss beloree seHioy prices dy. sme rkele re | mush. Undershand ” the x Price end deman J fa (see Pew Ore sereviag fen, relatong hep betes the orp any a Frtcing: in dilfercal dynes of WD Puree. Competition . ®. Mone pelishe (a) Oliga polistic D Monopely ™Marcke}o Fexplerdion Cp.) =14,15) Mala! Chaplen 4| Fire eee igopoly | Monopol Charlene comes Competition leer a baht _ 1 fe | | | Number. of: very | many i feuo | one . ae Trans _ Man I ree i Tyee of [Seeder Diffenenk. shandaredig. vee, me dese "Qed oded ed on ose ew __ [Cones enn) (A ercertiokd subsltules "Control ove So ec Contr! overt (Nene, depend co | cela fe Alel . SS een ae eehey Boareriers to | very asy, Relatively 4 'goifcan, enrey | bavrerciens a barercieres Blocked . Nom pretee Tver eee ld ‘ bh, osould eoepecl: competition Nowe Yerey wilh, se Mone, re Much di erential pub; he teel, lation, | preoduch, | astern | Darceulhs Reshauran iter Examples rhelite 4s, hotels hreks les, public | ak uli, Mies Mthendy pbs rch Fp paste ee ies ees) Phen Video | ole er oes fe Mel] Grocery RS «th shren mest | [ 2 ealln’ ae insureanceae Fa ow fl Maly sin tne price — demand reelatonshir 7 , poe Price the. company aan bh charege woill : cad og different level of demand. oh ‘The rel Hon al t na awa ~~ ship betureen dre pretce charged level 13 shown " i ee aff POs t : S) Sy ae ont Suaokhy demanded = 9 x Yank ema . Pere’ pertiod Teer EY demanded Per A. T, i 4d. T, elastic demand b. Pash. Demandx 19 Pctce Elasticity A measune of the! sensitivity of demand. te changes jn. pretee. Inelastic demand: If demand haredly charges sith 7 vo \ a smoll change So pretce, ure say demand 's inelaske.| Elashe demand : Th demand changes greatly, use say dhe demand is elastic. Xx Sacsdald “ol price elasticity: ce sales change i perecenb _ ~— Sprrice change in percent XTF demand 35 clastte reathere than inelashe, sellercs usill considerc lousersing thai pteices. A louwsere Price Gill preoduce wore total revenue. “Thy. Preachee makes sense as long as the eaten costs of ea and gelling mone de nol eonece d dhe eachean revenue ..x - i * Ths, Ee Romy x4 } a A, jmpac Economie conditions can have a $ one on the Browns Prejohng, strabegies. Economie ( factons Steh as boom ore poe inflodto, and interes} trates ed feat. Prefeing. decisions because they affect consumerc spending» Consumer Perrcephions of the product % and Valve , ond tie of prea ducin Pretce Som pany 4 Cosk GQ 2740 seltia “pemey Pricing Hhraleg Tes2 The most obvious response to He “nets eéonomic reeolifies is to cut prices and> Ser discounts. Thousands of companies have dene sus} ples Lewer pretees rnake products mone offerdabe | and help spure shonl—dere m sales, Housever, Such price cubs can have Undesirable long. ere eensequences, Lower Pretees mean Lower ™Mareyins. beep dis county May cheopen in tensuments eyes, And a breand once company auk Prtices , ihe Rel bk reatse dom agein ushen dhe ecomomy recovers, Rather than o uth a, a pruces many companies have inslead shifleg Mar raced ag ae on vadded tiene of foredable Isnes Lo a preeduct mines. Example! jo line sith Hghlere onsuUMmeR budgets & threiflsere spending habits, Pea has added | —Pprtice veresions of ik premium breands te! rake Them more offoredable, Ded Pe G launched Tam Sa Good deg food, elles designed is, a*mone accessible” adihon te ik preemium Lams brew louserah ecting 4 WOlher Exchernal factens afhecting- 4 Ercing decisions’ An OT EMI gachion must knous- then : iI have 07 © Dushah impact se pretee usil] have parcties in! ih environment 7 thet give ‘rtesellers oy Petre preefi L, “Neourcage Phetre Support and help Leen > tell ther pile diy Meclively sompany i. shorl—leny, sales, marke) share, and proof goals may need ton ; hmpened by broader Socelad se Sid erade ounas a factors thal make demand inelashe ‘ (oars) 4. No subshihiles: Th one has a care, therce ts mo allerrnedie butte buy peheal te BN up! the car. T on use rrely on the heain b ae +o oserde, | the treein Sinem can Increase prices usith We foll in demand. 2 Like Competition: IP a fires has mmenepely ousere then it is able de charge ae jeter P *q P Fon excamele , Ptttces on arden eany service stolons lend +e be Ngher, becouse consumers cant cheose Ushere to buy food, tate leaving the metorusay, 8 2) Bought inteequeotly: Th consumers buy qed infrequently , such as soll they are less Iikely by be sensitive te price 4. B small _perccerlage of income! goed like salt is & smell percentage "of income, there fone consumers usll tend to be less concenned about price .r af and s. Shore —reun: Ta the shopd—ran, dem ahs re tends +e be mone price inelaste. Tt fie time ton Sensumens Jo look ton al perenatives ae =F one has the best loeaion, His demand ill be more inelasHe. Hotel tH area Sea Views Can chare than ome in Ihe qe wmorce suburchs., rF— G6 —_—Ghapters =. 42: # Retionala behind © diy t a oO vert Y JOLAD prec Cparcl of EDLP) CP-N- 14) 7 a Ta severed mareceting studies , comsumears Fave jndicaled Hed they ane more content wail consistenlly low preces intead of usld preee susdn 3. This ts cushy tne EDip Fhe srrateay Goorks effect vely ; 1. simpli fed decisson makin: R. cansumeres do not have 4o csorery abod preoducls sna. on sale in the 5 ee MNousing reels a. reduced consumer search cost. UY. eonsumens can spend less Hye cormpareing, fop Bb the bes] deal. Epip Priomises customers Consistency in Prdcoas KH Hous Does EDLP usorck? “+ Ta the everyday lous preteinng olreochegy » the slores set theire preoducls at a reasonable same — preter ie a longer perciod. TL heles by stropl fying. dhe consumer's proce and mointatn the decision makin as the consumer need not have to dhiek abou cohen the sale uaill be coming.26 . Te Mstecd, they can buy their s "i Foire reebe pro Preeducls ot a " price anyhme they coool, 4, addition, this helps tHe shre + In Metre products j i US ory ; instead of on tye; n * prtoduch had sequins dy ee padre ° of the product dod “ 7 ff. rreqaine hey ods end Hag & manteLn a eubshioh Corel Yo provide significant ad wds amare) - 4 vantage io Fhe ding ds the based on demend and supply: & Prteing the Markel & demand: Good preleing shareds ye derstanding. ot hear eushomens/ of valve alfect Pre preiees they one a jes of perceephion are using +o pay. industriel buyers balance the price of a preoduct or service aged ost Ve benefily s). Thus, before selking pretees, undeastaund the relation demand An the Bolk consumer and of ousning dre amare kete re nus ship pefuseen price and preeduch com panies *aH Price bosed on mortkel demand considers Pluctiotons in customer demand and ad3usts pretces to FL dhe chenges in perceived value that come wath them, Demand- based preicing comes ino varied, of. forms —all united lay the the fact Vhat they play on consumer demand, “These methods Can verry based on severcal feclops , in cluding . als, ite Co ® Company's business Yoo's, | place in ily market, con sumert prefercences, and the quality of ib preeducl. Exec ple! The aircline indusley offins one of the rnost preorntnent, everyday -eacamples of demand — based mere Fight Rees Plchate based on elors like dirt & sensonaliby ot.io nae ferent types of ama ple elahonship: # Anely sing the price demand N ‘The pretee — demand relationship can be : inelas analyzed hough elaske & inelashe demand curve. Crean db) ded Freice Plasdheity : A eae of the sensidvidy hen of demand 1, changes ‘yn preice , ash Trelashe demand: Tf demand hared ly changes View WO Sashe demand: | with oa smal) change in Price, ure can Say demand 5. inelashe r Encormple : Th —rpre is stduction Aes cally ecuns esih evercy day, houshe] q preo ducts and services. When dye preiee changes, people Gail) shi] Purcchase rou hls the same goods & Pervices because amounk of as Ney did before as than needs stay Fhe sme BPRS same. Blastie demand « Strand the demand Lin al eee ee ee Tf qrealy , Use can say the demand is elastic. Baecom ple— lasers clothes have elas demand eee22 uoder the price -clasteily of demand. People usually rush 4o luceury brands ushen they announce discounts te buy more. Price elasheity of demand 7 Perccemtane change iw qusantity demanded Perccen tnae change in pree, Each price the company cmight charqa atl! lead Yo a differcest level of demand. The relobonship Yoeluseen IK. price charged and dhe resuldin, demand level is shown io dye foNousin demand e4rves a Ppreice Suamtity oe - Sa Op demanded per Perdod BSvaobty demand ad Tnelasie Demand Pers Period B. Blache Demand TP demand is elaslie reehare Han inelaste, sellers Usill coms dere lowserting }heire prices, Pr \ousert pretce usil) preoduce more tole neeave,his preachee Mokes 4 the -eaehea eee of Cree @ sellin Nore do rol mo} exceed ‘de och sense As les as ve revenue