TUTORIAL 8

E-Marketing Management: Price and Physical Evidence

1. Explain what factors might affect the wide price dispersion on the internet? In your
opinion, which of these factors has the biggest effect on the spread between online
prices?
I.
Strength of the firms brand
II.
How products are priced online
III.
Delivery options
IV.
Time-sensitive Consumers
V.
Differentiation
VI.
Switching costs
VII.
Second-Generation shopping agents
2. Identify and explain the pricing strategies available to an e-marketer?
There are 2 types of pricing strategies which are Fixed Pricing and Dynamic Pricing
I.
Fixed Pricing (The prices of all products in the company are fixed and cannot
be changed by the consumers (price negotiation is not allowed)
Two common fixed Pricing strategies used online: Price Leadership (Lowest product entry in a particular category)
Promotional Pricing (Encourage consumers to buy the product,
Usually carries expiration date that helps create a sense of urgency)
II.
Dynamic Pricing (The prices change vary the consumer)
Two common types of Dynamic Pricing used online: Segmented Pricing (Company sells a product or service at two or
more prices)
Price Negotiation (Company negotiates with individual consumers on
changing the price or certain products)
-The End-