3. Case Study: Dynamic Pricing – Strategies for Enhancing Profitability
Dynamic pricing is a collection of pricing strategies used by firms and organization to enhance profits. You will begin by exploring pricing techniques that operate in the market in real time. Then you will explore how auctions are employed in the search to find the value of goods and services. Consult the following video before getting started:
The Ideal Auction: https://www.numberphile.com/videos/the-ideal-auction?rq=ideal%20auctionInstructions
Write a 5–7 page paper in which you:
Compare and contrast surge versus congestion pricing. Provide a specific example of each currently in use.
There are many types of auctions, each with strengths and weakness at uncovering the real price/value of an item. Compare and contrast how each of the following uncovers value and provide a specific example of how each uncovers value:
The English auction and the Dutch auction.
The sealed-bid first-price auction and the Vickery Auction.
Auctions are widely used. Analyze an actual auction employed by each of the following:
A state or federal government or an agency of a state or federal government.
A for-profit business.
For each, explain what type of auction is employed and how the auction solves the problem of finding the best price for the good or service.
Read the Letter from Senator Warren to Fed on Wells Fargo FHC Status [PDF]. (Attached)
Explain how an auction to sell the Wells Fargo consumer-facing banking division might be used to determine the value of the division.
Include a recommendation on what type of auction might be used.
Use five sources to support your writing, including one published within the last six months. Choose sources that are credible, relevant, and appropriate. Cite each source listed on your source page at least one time within your assignment.
The specific course learning outcome associated with this assignment is:
Propose ways in which a company can use dynamic pricing to better uncover value and increase revenue.
The process of setting prices for your products and services is a difficult but crucial elements of managing an enterprise. The reason for using strategic pricing is to boost your profits in the maximum extent that is feasible. It’s not as easy as just increasing your price or increasing margins of profit, but they are good ways to begin (Cui and Xu, 2019). Each company is distinct in its own unique way. They offer a wide range of products, serve the diverse population of their customers and possess distinct market share. It is logical that there isn’t any pricing system that can be universally applied to all circumstances (Madhani 2021). Pricing strategies are the method by how a company utilizes price to attain a particular commercial objective. It analyzes the emotional reaction that customers experience to various types of pricing and how this affects their buying decisions. Price plans will be more likely succeed by taking into consideration the four main pillars of pricing. This includes other companies within your field and your customers as well as where you currently stand as well as your expenses. Cont…
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