Shattering the Myth of Costless Price Changes: Emerging Perspectives on Dynamic Pricing
AbstractIn this paper we argue that pricing is all about price changes, and that the costs of price changes are often simultaneously subtle and substantial. We discuss a framework to deal with the dynamics of changing prices. This framework incorporates customer interpretations of price changes, an awareness of the organizational costs of price changes, investments in future pricing processes, and an understanding of the role that supply chains play in price change strategy. The framework can be used at the tactical level to improve the specific price changes chosen and made, at the managerial level to decide whether or not to make a particular price change at all, and at the strategic level to determine what price adjustment processes should be invested in to improve pricing effectiveness in the future.
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Bibliographic InfoPaper provided by Bar-Ilan University, Department of Economics in its series Working Papers with number 2003-09.
Date of creation: Sep 2003
Date of revision:
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Postal: Faculty of Social Sciences, Bar Ilan University 52900 Ramat-Gan
Phone: Phone: +972-3-5318345
Web page: http://www.biu.ac.il/soc/ec
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Pricing; price setting; price adjustment; cost of price adjustment; price change management; investment in pricing processes; supply chains; customer costs of price adjustment;
Other versions of this item:
- Mark Bergen & Mark Ritson & Shantanu Dutta & Daniel Levy & Mark Zbaracki, 2005. "Shattering the Myth of Costless Price Changes: Emerging Perspectives on Dynamic Pricing," Others 0505006, EconWPA.
- Mark Bergen & Shantanu Dutta & Daniel Levy & Mark Ritson & Mark Zbaracki, 2003. "Shattering the Myth of Costless Price Changes: Emerging Perspectives on Dynamic Pricing," Emory Economics 0325, Department of Economics, Emory University (Atlanta).
- M31 - Business Administration and Business Economics; Marketing; Accounting - - Marketing and Advertising - - - Marketing
- M10 - Business Administration and Business Economics; Marketing; Accounting - - Business Administration - - - General
- M20 - Business Administration and Business Economics; Marketing; Accounting - - Business Economics - - - General
- L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
- L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
- E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
- D40 - Microeconomics - - Market Structure and Pricing - - - General
- D20 - Microeconomics - - Production and Organizations - - - General
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