In: Economics
Make sure the answers are correct, well explained, thoughtful, and have no grammar mistakes. DO NOT COPY answers from Chegg or other websites. The answer should be unique and original work. The answer should be no less than 300 words. Thanks in advance.
Tell us the following: A time when you bought something based on each of the pricing strategies.
- Clearance
- Coupons
- Bundling
- Quantity Discount
- Odd Pricing
Also, what are something you are elastic AND something you are inelastic as it comes to pricing?
Finally, what is a retail brand that you think has a GOOD advertising campaign, and WHY? Also, what is a retail brand that you think gets good public relations/publicity and WHY?
Price elasticity of a
product/service depends on various factors such as the nature of
the product (its location on the necessity-luxury continuum),
number of close substitutes, proportion of income being spent on
the product, price of switching to a substitute, frequency of use
and personal taste and preferences of the consumer. For me, I'm
very price elastic to everyday FMCG products, stationery items and
products with low levels of differentiation amongst competitors. On
the other hand, I'm quite price inelastic to products/services
which are differentiated across the market (such as consumer
durables and electronic gadgets) and products I use habitually (a
particular beer brand).
I think NIke has a really good advertising campaign. Back in the
day, Nike and its competitors used to cater almost solely to
marathon runners and sportsperson. This all changed in the 1980's
when Nike's "Just Do It" advertising campaign came into being. Nike
was able to transcend its product from something which was aimed at
the sport personnel to something every person could use and benefit
from. Instead of selling its products, Nike aimed at selling the
"act of physical activity" and the benefits of using the product
(such as a better physical health, protection from cardiovascular
diseases, a fitter lifestyle etc.) The campaign still holds its own
even after almost four decades of it being launched and it
continues to build brand equity for Nike.
One of the retail companies which I think gets good
publicity/public relations is P&G. This company has been able
to take its products to grass root levels, even in the poorest of
countries through its top of the line distribution system and made
healthcare products available to even the poorest strata. The
company has understood the market dynamics very well and it tweaks
its products according to the market its operating in, for example
it understood the differences in price sensitivity and buying
patterns in the US and India, accordingly it offers smaller SKU's
(shop keeping units) in a price sensitive Indian market, where
people prefer repeated buying as opposed larger SKU's in lesser
price sensitive US market, where people tend to buy in bulk.
Keeping in mind these differences, it sustains a huge product mix
and multiple product lines, with products ranging from high end to
ultra affordable. P&G has also taken extensive charity work and
undertaken countless environmental and CSR initiatives in many
countries across the world which has brought in praise for the
company worldwide and it enjoys an excellent reputation in the
market.