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The Considerations of Pricing Strategies in Multiple Industries - Essay Example

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This essay “The Considerations of Pricing Strategies in Multiple Industries” describes the many different pricing philosophies of several real-time companies along with an explanation of how this impacts managing a business environment in terms of pricing and profitability…
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The Considerations of Pricing Strategies in Multiple Industries

Download file to see previous pages... Burrows (2009) describes the dilemmas at Microsoft company when deciding pricing policy on its many different technology and consumer-oriented products. Microsoft maintains tremendous buying power in its technology market but is facing pricing issues in the midst of a global economic slowdown and rising competition in this market. Microsoft is now wondering, in order to keep sales volumes up and profit at expected levels, whether the business should consider lowering the prices on a wide variety of Microsoft branded products. Says CEO Steve Ballmer of Microsoft, “we’re focusing on gaining share in (new markets) that are most critical” (Burrows, p.51). Apparently, Microsoft has considerable problems in some markets, such as in Asia, with large volumes of pirating occurring in its computer-related technology marketplaces. Piracy, when customers are able to get their hands on Microsoft products without a proper license, erodes sales success at the company. Therefore, Microsoft considers that in these markets where piracy runs high, they can lower the price of the technology software to make the product less appealing from illegal markets and will bring buyers into the store instead to make a purchase. Even though there is no research evidence which shows that Microsoft has determined a price policy that fits with the company’s leadership expectations, clearly a consideration of pricing is the ability to avoid piracy and also to make products seem more attractive to buyers with fewer resources in order to boost higher sales volumes.
Cooper (2009) describes how the regulatory environment impacts pricing, by describing data from the Digital Britain Report.  ...Download file to see next pagesRead More
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