Price Elasticity

Price management has a high importance within the marketing field. Price is by far the most sensitive profit lever that managers can influence. Reflecting the academic and managerial need, the research objective is to gain a comprehensive understanding in two areas: the magnitude of price elasticity and the determinants of price elasticity.

Price is a fundamental profit driver. It is by far the most sensitive profit lever that managers can influence. Very small price changes translate into enormous changes in profit. Price elasticity indicates how sensitively consumers react to price changes. Not only the knowledge about the magnitude of price elasticity, but also the knowledge about the determinants influencing the price reaction is essential. It is crucial for the development of a successful marketing strategy to understand how price elasticities vary with market and product characteristics. Reflecting the academic and managerial need, the objective of the research is to gain a comprehensive understanding in two main areas, the magnitude of price elasticity and the determinants of price elasticity.

Autorentext

Evelyn Friedel studied Business Administration at the University of Mannheim (Germany) and at Pepperdine University in Malibu (USA). She concentrated her studies in Marketing, International Management and Business Psychology. After having worked as a strategy and pricing consultant in Germany and the USA, she is currently engaged as a Strategic Pricing Manager in the healthcare industry.

Inhalt

Contents: Price Elasticity - Demand - Profit - Price - Academic Publications - Consulting Projects - Consulting Project Data - Price Sensitivity - Multiple Linear Regression - Stepwise Regression - Price Response Function - Amoroso-Robinson Relation.