By Michael Armstrong
This advisor to fashionable innovations in all fields of administration is a perfect spouse for pro managers, in addition to an important reference booklet for company and administration scholars. It comprises over a hundred systematic and analytical equipment used to help in decision-making and to enhance potency and effectiveness.
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Extra info for A Handbook of Management Techniques
Revenue may also fall below attainable levels if prices are lower than the perceived value. Psychological pricing Many consumers use price as an indicator of quality. Prestige pricing uses higher prices to promote the idea of value and status. 00. These pricing points, as they are called, persuade people to think that the price is in a lower range than they expected. Value for money can be emphasized by the effective presentation of discounts and free offers. The perceived value of offering one item free if four items are purchased may have a greater impact than a 20 per cent discount offered over the whole five purchases.
It covers the following subdivisions: ᔢ Industrial markets – where the major criterion is keeping production satisfied in order that materials and components are available for incorporation in production processes. The ultimate objective is to satisfy the needs of the company’s customers, be they intermediate manufacturers further down the production chain or end customers. ᔢ Institutional markets – relates to purchasing for public institutions like the police force, the fire service, local and central government establishments and educational establishments.
The aim is to achieve high initial sales, which are maintained during the life cycle of the product. An associated aim is to deter competitors. Penetration pricing is particularly appropriate for products where unit cost reductions can be achieved through initial mass production. Setting-up costs are usually high and initial development costs are recovered over a long period. The task of marketing is to ensure that customers retain interest during the life of the product. Skimming A skimming approach adopts a high-price strategy, charging what the market will bear.