Intro to Marketing_Herzenstein_Date_051010

Intro to Marketing_Herzenstein_Date_051010 - -1 st movie...

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More price Know that general overhead is a fixed cost Product line pricing: - To fit need of different consumers - Economies of scale= more efficient/cheaper - Differentiating yourself from competitors Increase product (increase complement/decrease substitute) - Price complement/ product—one is higher than the other because usually buy both anyways 2 soda stands: - Green buy from west, blue from East—because they are a tiny bit closer Soda examples: - Understand this! - The more stands we have the closer the demand curve will be to becoming completely flat - Fixed costs= holding us back Bundling: - Sell two products together and can also buy them separately—usually better deal if buy the bundle o Do this to secure the demand - Tie-in: two sold together but only sold together, not separate at all—usually illegal - Most liberal approach: gallon and ½ gallon (price gallon at less than 2x price of ½ gallon)
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Unformatted text preview: -1 st movie example: bundle= more profit o Always try to get best/highest profit What are results reserved?-Because two cities are not even close when sum willingness to pay The Psychology of Pricing-Look at consumption ( and other not so hardcore econ concepts) Pricing cues:-Sale sign: because think you are getting a deal-Price ends with 9: just below cutoff—signals “better” price-Signpost items: if one thing (we actually know the price of) is considered cheap then we think everything else in the store will be too-Make it loss leader to bring people into store (at entrance) Psychology of consumption (graphs):-Attendance= high at beginning but not much until the end for all except for monthly-Make sure people are consuming so they will renew Sunk cost effect:-Use this to feel like you are not wasting money...
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Intro to Marketing_Herzenstein_Date_051010 - -1 st movie...

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