Module 1 Lecture 5 - Fall 2010 Module 1 Delighting...

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David Robinson © D. Robinson, 2010 Fall 2010 Module 1 Delighting Customers Lecture 5: Pricing & The Value Proposition
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Price as one element of the Marketing Mix Marketing Mix Product Price Place Promotion
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Class 5: Pricing Pricing and economics Pricing objectives Pricing strategies New Product pricing Pricing in Maturity Pricing tactics
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The familiar “Demand Curve” Quantity demanded $ Price Fewer people want to buy at higher prices
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The familiar “Demand Curve” Quantity demanded $ Price On the other hand: “In any market, some people want to pay more”
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Price too high … Low Q $ Price Quantity demanded Segway Personal Transporter $5,145 !
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Price too high … Low Q $ Price Quantity demanded Q we produce We have this many left over
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Price too low … High Q We may not be able to meet demand, and . . . $ Price Quantity demanded
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Price too low … High Q We may not be able to meet demand, and $ Price Quantity demanded These people wanted to pay more, so we “leave money on the table” Means: Give up some profit we could’ve made
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Differentiation Moves the curve up (and allows us to charge more) $ Price Quantity demanded
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Smart Pricing [® reader article] means charging many different prices
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Module 1 Lecture 5 - Fall 2010 Module 1 Delighting...

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