Although findings have been somewhat inconsistent, there is evidence from both experimental studies and field research that prices set just below the nearest round figure produce higher than expected demand at that level. Among the different explanations that have been proposed for these effects...

A study is reported, which investigated Singapore consumers’ price thresholds and saturation points for price discounts. The study shows that consumers discount the offered price discount, i.e. they lower the dollar gain value. This discounting of discounts increases significantly with the...

Price is an important variable because it has a direct impact on a company’s profitability. However, there is limited evidence to support the effectiveness of competing strategies of fixed pricing and discounted pricing. As a result, both strategies are practised extensively in the industry....

Value pricing requires a marketer to price his/her product according to the value the product brings to its user. A product with network effects makes it difficult to assess the value of the product to its customer, thus presenting a challenge to the value pricing principle. This paper reviews...

Research conducted over the last decade, on the influence of brand inertia or variety seeking on promotional response, has yielded mixed results. Variety seekers have been found to be more price‐sensitive by one set of researchers, while another stream of work finds them to be less sensitive....

Standard approaches to price decisions are normally illustrated as step‐by‐step developments that try to group pricing issues loosely into some format. These current approaches do not emphasize the interaction of consumer characteristics with the competitive environment of each market....

Codifies a unique marketing and valuation principle: the exclusive value principle (EVP). This principle relates value creation to “psychic space”. Psychic needs can create enormous margins and other benefits. One can influence price/demand as well a create, stimulate, or help define a need...

Presents a simple and concise survey method for measuring price sensitivity and illustrates its use by examining the relationship between innovativeness and price sensitivity within a specific product category. The results of a survey of 457 students revealed a negative relationship between...

The price at which a product is offered often does not consist of a single item of information, for example VW Golf, price; DM25,476. Instead, a multidimensional pricing system is used, e.g. the price comprises a down payment, monthly installments and a repayment period in months. Despite the...

Type of article Theoretical with worked example