A Price War Is More Likely When?
-The current profit margin (before price cut) is high
-The reduction in marginal costs due to the price cut is high (significant scale economies, high initial fix costs)
-The product differentiation is low
-The price cut can significantly increase the total demand
-The price cut can significantly increase the firm's market share (e.g., competitors unprepared)
-The price war can significantly increase consumer awareness of the initiator's brand.
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Global Pricing Strategy
- What are Three Motivators to Galanz's First Price War?
- Chinese executives and business thought leaders consider price wars.
- What is a Price War?
- What is the relationship between Masculinity and Pricing Elasticity AND Rating Elasticity?
- What is the relationship between Power Distance and Rating Elasticity?
- What is the relationship between Uncertainty Avoidance and Price Elasticity?
- What is the relationship between Individualism and Price Elasticity?
- How are individualistic American Consumers effected by loss of "face"?
- How are collectivist Chinese Consumers effected by loss of "face"?
- What is Culture's Sensitivity to "face" ?
- How do Chinese consumers perceive "Price Fairness" in regards to First-time buyer vs. loyal customer getting a better deal?
- How do American consumers perceive "Price Fairness" in regards to First-time buyer vs. loyal customer getting a better deal?
- How do Chinese consumers perceive "Price Fairness" in regards to Friends vs. Strangers getting a better deal?
- How do American consumers perceive "Price Fairness" in regards to Friends vs. Strangers getting a better deal?
- How does the internet affect why companies should care about "Price Fairness"?
- Why should companies care about "Price Fairness"?
- Why Care about "Price Fairness"?
- When is Penetration Pricing used?
- Why is penetration pricing used?
- Which pricing strategy is used to deliberately offer products at a low price to stimulate market growth and capture market share?
- When is Market Skimming Used?
- Why is Market Skimming Used?
- Which pricing strategy is used when a company wants to charge a premium price in a deliberate attempt to reach a segment that is willing to pay a high price?
- When is Market Pricing used?